DOCSLIB.ORG

Middle Class Woe 1 May 2012

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Middle Class Woe 1 May 2012 Middle class woe 1 May 2012 the American middle class has been battered by pensions to mutual funds for retirees. Nocera the loss of well-paying jobs for the 70 percent of disavowed the conclusion of his 1995 book, “A the workforce without a college degree and failed Piece of the Action,” which painted a rosy picture of by would-be protectors in government and private transition from a “country full of people who had institutions, said panelists at the 35th Anniversary money in the bank to a country of people who Forum of the Harvard Institute for Learning in invested in the stock market.” Retirement on Friday. But as wages flattened with the decline of U.S. Former Pennsylvania Gov. Ed Rendell, whose manufacturing, he said, “This shift has turned out forthcoming book “A Nation of Wusses” criticizes to be terrible for the people who have to save for politicians of both parties for failing to act in the their own retirement.” country’s best interest, pointed to elected officials and corporate leaders who can’t see beyond the It transferred risk from the institution to the next election or quarterly earnings report. individual, putting more pressure on the middle class, said Nocera, whose latest book, “All the “Nobody is looking at what happens 15 or 20 Devils Are Here,” is about the hidden history of the years down the road,” he said. And regardless of financial crisis. political persuasion everyone has a stake in the future: “We can’t have a good economy if middle The best way to help middle-income residents in class income continues to go down.” the United States would be to address the housing crisis, Nocera said. “We have no housing policy. Frank Levy, an MIT urban studies and economics Most people’s equity is tied up in their house and professor, outlined how the middle class has the country has not decided what to do with Fannie suffered declines since the 1970s as a result of and Freddie.” trends ranging from globalization to rising tuition costs. “Is it all the Republicans’ fault?” asked moderator Paul Solman, PBS business and economics “Roughly speaking, the society, including the correspondent and Harvard M.B.A. ’79, in government and individuals, has made a lot of introducing Rendell, a leading Democrat. promises about payments to make in future that we can no longer make,” he said. “Yes,” Rendell said, to widespread laughter at the nearly full First Parish church in Cambridge. The middle class has been hurt by the failure of policymakers to plan and account for a sharp rise Rendell said the best thing that could happen to in health care costs and the widespread job losses corporate America would be to get rid of quarterly tied to the housing collapse. earnings reports that put shareholders’ returns ahead of visionary and wise business The question, Levy said, is: “How are we going to management. distribute the losses? How much will be absorbed by lower incomes and how much will be absorbed There was agreement among the panelists that in the present versus the future?” U.S. corporations should pay more taxes. New York Times columnist Joe Nocera assigned Levy noted that the United States is in the bottom another aspect of diminished incomes to the zeal third of corporate taxes paid in the world. corporate leaders since the 1980s have had for downsizing to boost profits, and the shift from Nocera said that tax reform would free up a lot of 1 / 2 corporate money for better purposes. “You would generate more revenue and make the corporations more efficient because GE wouldn’t have a 1,000-person tax office to find loopholes,” Nocera said. “But the reason it will never happen is this is how Congress lives and dies. They generate their own revenues by saving those loopholes or creating new ones.” The panelists agreed that skyrocketing tuition is hitting the middle class hardest. “If you’re poor, you can get grants and the rich pay full price,” said Nocera, using the example of the California public college system that now charges in-state students $30,000. “If you’re middle class you can’t afford it. “The state of California has taken this jewel and said we’re not going to cut back on our prison system but we’re going to cut back on our university system and balancing its budget on the backs of the middle class.” Nocera concluded, however, “The middle class is under siege but it’s not quite as hopeless as people like me portray it.” This story is published courtesy of the Harvard Gazette, Harvard University's official newspaper. For additional university news, visit Harvard.edu. Provided by Harvard University APA citation: Middle class woe (2012, May 1) retrieved 28 September 2021 from https://phys.org/news/2012-05-middle-class-woe.html This document is subject to copyright. Apart from any fair dealing for the purpose of private study or research, no part may be reproduced without the written permission. The content is provided for information purposes only. 2 / 2 Powered by TCPDF (www.tcpdf.org).
Load more

Recommended publications
  • Capitalism and Risk: Concepts, Consequences, and Ideologies Edward A
    digitalcommons.nyls.edu Faculty Scholarship Articles & Chapters 2016 Capitalism and Risk: Concepts, Consequences, and Ideologies Edward A. Purcell New York Law School Follow this and additional works at: http://digitalcommons.nyls.edu/fac_articles_chapters Part of the Consumer Protection Law Commons, and the Law and Economics Commons Recommended Citation 64 Buff. L. Rev. 23 (2016) This Article is brought to you for free and open access by the Faculty Scholarship at DigitalCommons@NYLS. It has been accepted for inclusion in Articles & Chapters by an authorized administrator of DigitalCommons@NYLS. Capitalism and Risk: Concepts, Consequences, and Ideologies EDWARD A. PURCELL, JR.t INTRODUCTION Politically charged claims about both "capitalism" and "risk" became increasingly insistent in the late twentieth century. The end of the post-World War II boom in the 1970s and the subsequent breakup of the Soviet Union inspired fervent new commitments to capitalist ideas and institutions. At the same time structural changes in the American economy and expanded industrial development across the globe generated sharpening anxieties about the risks that those changes entailed. One result was an outpouring of roseate claims about capitalism and its ability to control those risks, including the use of new techniques of "risk management" to tame financial uncertainties and guarantee stability and prosperity. Despite assurances, however, recent decades have shown many of those claims to be overblown, if not misleading or entirely ill-founded. Thus, the time seems ripe to review some of our most basic economic ideas and, in doing so, reflect on what we might learn from past centuries about the nature of both "capitalism" and "risk," the relationship between the two, and their interactions and consequences in contemporary America.
    [Show full text]
  • The Global Financial Crisis and Proposed Regulatory Reform Randall D
    View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by Brigham Young University Law School BYU Law Review Volume 2010 | Issue 2 Article 9 5-1-2010 The Global Financial Crisis and Proposed Regulatory Reform Randall D. Guynn Follow this and additional works at: https://digitalcommons.law.byu.edu/lawreview Part of the Banking and Finance Law Commons Recommended Citation Randall D. Guynn, The Global Financial Crisis and Proposed Regulatory Reform, 2010 BYU L. Rev. 421 (2010). Available at: https://digitalcommons.law.byu.edu/lawreview/vol2010/iss2/9 This Article is brought to you for free and open access by the Brigham Young University Law Review at BYU Law Digital Commons. It has been accepted for inclusion in BYU Law Review by an authorized editor of BYU Law Digital Commons. For more information, please contact [email protected]. DO NOT DELETE 4/26/2010 8:05 PM The Global Financial Crisis and Proposed Regulatory Reform Randall D. Guynn The U.S. real estate bubble that popped in 2007 launched a sort of impersonal chevauchée1 that randomly destroyed trillions of dollars of value for nearly a year. It culminated in a worldwide financial panic during September and October of 2008.2 The most serious recession since the Great Depression followed.3 Central banks and governments throughout the world responded by flooding the markets with money and other liquidity, reducing interest rates, nationalizing or providing extraordinary assistance to major financial institutions, increasing government spending, and taking other creative steps to provide financial assistance to the markets.4 Only recently have markets begun to stabilize, but they remain fragile, like a man balancing on one leg.5 The United States and other governments have responded to the financial crisis by proposing the broadest set of regulatory reforms Partner and Head of the Financial Institutions Group, Davis Polk & Wardwell LLP, New York, New York.
    [Show full text]
  • After the Meltdown
    Tulsa Law Review Volume 45 Issue 3 Regulation and Recession: Causes, Effects, and Solutions for Financial Crises Spring 2010 After the Meltdown Daniel J. Morrissey Follow this and additional works at: https://digitalcommons.law.utulsa.edu/tlr Part of the Law Commons Recommended Citation Daniel J. Morrissey, After the Meltdown, 45 Tulsa L. Rev. 393 (2013). Available at: https://digitalcommons.law.utulsa.edu/tlr/vol45/iss3/2 This Article is brought to you for free and open access by TU Law Digital Commons. It has been accepted for inclusion in Tulsa Law Review by an authorized editor of TU Law Digital Commons. For more information, please contact [email protected]. Morrissey: After the Meltdown AFTER THE MELTDOWN Daniel J. Morrissey* We will not go back to the days of reckless behavior and unchecked excess that was at the heart of this crisis, where too many were motivated only by the appetite for quick kills and bloated bonuses. -President Barack Obamal The window of opportunityfor reform will not be open for long .... -Princeton Economist Hyun Song Shin 2 I. INTRODUCTION: THE MELTDOWN A. How it Happened One year after the financial markets collapsed, President Obama served notice on Wall Street that society would no longer tolerate the corrupt business practices that had almost destroyed the world's economy. 3 In "an era of rapacious capitalists and heedless self-indulgence," 4 an "ingenious elite" 5 set up a credit regime based on improvident * A.B., J.D., Georgetown University; Professor and Former Dean, Gonzaga University School of Law. This article is dedicated to Professor Tom Holland, a committed legal educator and a great friend to the author.
    [Show full text]
  • Americans for Tax Fairness Selected Opinion Pieces on Corporate Inversions
    AMERICANS FOR TAX FAIRNESS SELECTED OPINION PIECES ON CORPORATE INVERSIONS As of October 1, 2014 NATIONAL Fortune – Positively un-American Tax Dodgers, Allan Sloan, July 7, 2014 “Undermining the finances of the federal government by inverting helps undermine our economy. And that’s a bad thing, in the long run, for companies that do business in America.” Fortune – Foreign Tax Ploys Raise a Question: What is an American Company?, Allan Sloan, June 2, 2014 “But in the past few years, as the world has become more global and other countries have cut their corporate rates, a new exodus wave has started. ‘For the past 20 years, there’s been an arms race between the companies on the one hand and the IRS and Congress on the other, and the companies always seem to come up with better weapons,’ says tax expert Bob Willens.” The New York Times – Cracking Down on Corporate Tax Games, The Editorial Board, September 23, 2014 “New rules from the Treasury Department[2] are likely to slow the offensive practice that allows American companies to avoid taxes by merging with foreign rivals. Known as corporate inversions, these are complex, modern variations on the practices of yesteryear, when companies dodged their taxes by moving their addresses to post office boxes in the Caribbean.” The New York Times – At Walgreen, Renouncing Corporate Citizenship, Andrew Ross Sorkin, June 30, 2014 “In Walgreen’s case, an inversion would be an affront to United States taxpayers. The company, which also owns the Duane Reade chain in New York, reaps almost a quarter of
    [Show full text]
  • April 2011 Quarterly Program Topic Report Category: Abortion NOLA: MLNH 010002 Series Title: PBS Newshour Length
    April 2011 Quarterly Program Topic Report Category: Abortion NOLA: MLNH 010002 Series Title: PBS NewsHour Length: 60 minutes Airdate: 4/8/2011 6:00:00 PM Service: PBS Format: News Segment Length: 00:10:09 Budget Battle Lines Drawn Over Spending, Planned Parenthood as Shutdown Nears: Federal agencies prepared for a shutdown as negotiators struggled to reach a budget compromise. Jeffrey Brown discusses the latest on the budget talks with Todd Zwillich, Washington correspondent for WNYC radio. Category: Abortion NOLA: MLNH 010015 Series Title: PBS NewsHour Length: 60 minutes Airdate: 4/27/2011 6:00:00 PM Service: PBS Format: News Segment Length: 00:07:47 Budget Battles Reignite Animosity Between Congress, D.C. Government: Kwame Holman reports on the historically tense relations between Congress and the District of Columbia's residents and local politicians. The two worlds collided recently when Congress and President Obama reached a budget agreement in part through provisions affecting abortion services and private- school voucher programs in D.C. Category: Aging NOLA: MLNH 010000 Series Title: PBS NewsHour Length: 60 minutes Airdate: 4/6/2011 6:00:00 PM Service: PBS Format: News Segment Length: 00:06:55 Estrogen Study Lead Researcher on Risks, Benefits of Hormone-Replacement Therapy: Once a popular treatment for menopause symptoms, hormone- replacement therapy had come under scrutiny for raising the risk of certain diseases, but a new study found a reduced risk of breast cancer and other benefits for some women. Jeffrey Brown discusses the latest findings with Dr. Andrea LaCroix, the study's lead author. Category: Aging NOLA: NBRT 030214 Series Title: Nightly Business Report Length: 30 minutes Airdate: 4/28/2011 5:30:00 PM Service: PBS Format: Magazine Segment Length: 00:00:00 Baby Boomers are Working Longer; Baby Boomers, Retirement, and Inheritance; NYSE Says No to Merger Bids; Demand for Nuclear Energy Rises; Preview of Berkshire Hathaway Shareholder Meeting; US Economy Slows in First Quarter; Market Focus with Tom Hudson; Market Stats for April 28, 2011.
    [Show full text]
  • A Business Lawyer's Bibliography: Books Every Dealmaker Should Read
    585 A Business Lawyer’s Bibliography: Books Every Dealmaker Should Read Robert C. Illig Introduction There exists today in America’s libraries and bookstores a superb if underappreciated resource for those interested in teaching or learning about business law. Academic historians and contemporary financial journalists have amassed a huge and varied collection of books that tell the story of how, why and for whom our modern business world operates. For those not currently on the front line of legal practice, these books offer a quick and meaningful way in. They help the reader obtain something not included in the typical three-year tour of the law school classroom—a sense of the context of our practice. Although the typical law school curriculum places an appropriately heavy emphasis on theory and doctrine, the importance of a solid grounding in context should not be underestimated. The best business lawyers provide not only legal analysis and deal execution. We offer wisdom and counsel. When we cast ourselves in the role of technocrats, as Ronald Gilson would have us do, we allow our advice to be defined downward and ultimately commoditized.1 Yet the best of us strive to be much more than legal engineers, and our advice much more than a mere commodity. When we master context, we rise to the level of counselors—purveyors of judgment, caution and insight. The question, then, for young attorneys or those who lack experience in a particular field is how best to attain the prudence and judgment that are the promise of our profession. For some, insight is gained through youthful immersion in a family business or other enterprise or experience.
    [Show full text]
  • Subprime Bailouts and the Predatory State. Steven A
    Loyola University Chicago, School of Law LAW eCommons Faculty Publications & Other Works 2009 Subprime Bailouts and the Predatory State. Steven A. Ramirez Loyola University Chicago, [email protected] Follow this and additional works at: http://lawecommons.luc.edu/facpubs Part of the Housing Law Commons Recommended Citation Ramirez, Steven, Subprime Bailouts and the Predatory State, 35 U. Dayton L. R. 81 (2009) This Article is brought to you for free and open access by LAW eCommons. It has been accepted for inclusion in Faculty Publications & Other Works by an authorized administrator of LAW eCommons. For more information, please contact [email protected]. SUBPRIME BAILOUTS AND THE PREDATOR STATE Steven A. Ramirez INTRODUCTION According to Senator Dick Durbin, the Senate Majority Whip, the banking industry is the "most powerful lobby" in Congress and "they frankly own the place."' Congressman Collin C. Peterson, the chair of the House Agriculture Committee, maintains that derivatives regulation is problematic in Congress because "[t]he banks run the place."2 President Obama pledged that his administration would include no lobbyists, and then promptly waived his own new rules so that a former Goldman Sachs lobbyist could be the Chief of Staff for the Secretary of the Treasury. In the election of 2008 the banking and investment banking industry contributed to both the Democratic and Republican candidates: according to Opensecrets.org, Senator John McCain's top five campaign contributors were all large financial institutions. 4 President Barack
    [Show full text]
  • College Sports Reform: a View of the Likely End Game Via Four Related Commentaries
    College Sports Reform: A View of the Likely End Game via Four Related Commentaries It’s Time to Expose the Big Lie Congress has been reluctant to strip the NCAA and its member universities of their tax-exempt status and so help limit the seemingly uncontrolled growth of professionalized big-time college sports entertainment. Striking Parallels of Abuse A follow up on previous commentaries on Penn State points out the striking parallels between the sexual abuse scandal at Penn State and in the many such scandals in the Catholic Church. The Tainted Glory of College Sports On the motivation behind Sonny Vaccaro’s endorsement of David Ridpath’s book, Tainted Glory, and the antitrust lawsuits against the NCAA while again pointing out the need for corrective action in the world of college sports. On Taxing College Sports Related Revenues On why questionable tax breaks—treated as entitlements by the NCAA and its member institutions—go unchallenged by the federal government and what lies ahead By Dr. Frank G. Splitt FutureVectors, Inc. Mount Prospect, IL December 31, 2012 CONTENTS PREFACE IT’S TIME TO EXPOSE THE BIG LIE……………………………………………………1 STRIKING PARALLELS OF ABUSE…………………………………………………….2 THE TAINTED GLORY OF COLLEGE SPORTS………………………………………..4 ON TAXING COLLEGE SPORTS RELATED REVENUES…………………………… 6 ACKNOWLEDGEMENTS……………………………………………………………….10 THE AUTHOR……………………………………………………………………… ……11 Perhaps the sentiments contained in these pages are not yet sufficiently fashionable to procure them general favour; a long habit of not thinking a thing wrong, gives it a superficial appearance of being right, and raises at first a formidable outcry in defense of custom. But the tumult soon subsides.
    [Show full text]
  • One Shining Moment to a Dark Unknown Future: How The
    5 COX PRODUCTION (DO NOT DELETE) ONE SHINING MOMENT TO A DARK UNKNOWN FUTURE: HOW THE EVOLUTION OF THE RIGHT OF PUBLICITY HAMMERS HOME THE FINAL NAIL IN THE NCAA’S ARGUMENT ON AMATEURISM IN COLLEGIATE ATHLETICS Wayne M. Cox, Esq.* I. INTRODUCTION On the night of March 26, 1979, a truly momentous event captured the imagination of Americans and unexpectedly forced its way into millions of homes nationwide.1 This television occasion failed to involve royalty, politicians, or even a critically-acclaimed scripted television program, but instead focused the spotlight onto a couple dozen college students.2 Taking place in Salt Lake City, Utah, basketball teams representing Michigan State University and Indiana State University, featuring two players not yet known simply as “Magic”3 and “Larry Legend,”4 squared off for the 1979 * New York Attorney, Katz & Rychik, P.C.; J.D. 2015, Maurice A. Deane School of Law at Hofstra University; B.S. 2012, Villanova University School of Business. Thank you to every member of the 2016 National Champion Villanova Wildcats and the entire Villanova community for acting as a shining reminder for everything that is great and inspiring about collegiate athletics in a time of such turmoil. 1 See Scott Taylor, 25th Anniversary: 1979 Final Four, DESERET NEWS (Mar. 26, 2004), http://www.deseretnews.com/article/595051666/25th-Anniversary-1979-Final-Four.html?pg= all; see also Mike Lupica, The First Real March Madness Was Magic vs. Bird in 1979, N.Y. DAILY NEWS (Mar. 26, 2015), http://www.nydailynews.com/sports/college/lupica-march-bird- magic-started-madness-article-1.2152131 (describing the momentous game).
    [Show full text]
  • STATEMENT of DR. MARK COOPER DIRECTOR of RESEARCH On
    STATEMENT OF DR. MARK COOPER DIRECTOR OF RESEARCH on ENERGY MARKET MANIPULATION AND FEDERAL ENFORCEMENT REGIMES Before the COMMITTEE ON COMMERCE, SCIENCE AND TRANSPORTATION UNITED STATES SENATE June 3, 2008 SUMMARY The speculative bubble in petroleum markets has cost the economy well over half a trillion dollars in the two years since the Senate Permanent Subcommittee on Investigations, Committee on Homeland Security and Governmental Affairs first called attention to this problem. That speculative bubble in energy commodities has cost households, on average, about $1500 over the past two years in increased costs for gasoline and natural gas. The Commodity Futures Trading Commission and the Federal Energy Regulatory Commission have failed to protect the public because they were slow to recognize the problem and are not looking for the real causes, examining a narrow set of abuses that ignore the much broader problem in the commodity futures markets. The Federal Trade Commission’s recent Advanced Notice of Proposed Rulemaking implementing the expanded powers it was given under the Energy Independence and Security Act of 2007 appears to be repeating the same mistake that the Federal Energy Regulatory Commission made in implementing the provision of the Energy Policy Act of 2005 that gave it expanded powers. The overall pattern of prices supports the proposition that they have run up beyond anything that is justified by the problems in the physical market. We have a commodity that is vulnerable to abuse, in a new market that has been under-regulated from its birth. Public policy adopted in 2000 further reduced regulation and opened the door to counterproductive, if not outright manipulative, behaviors and pushed prices higher.
    [Show full text]
  • SYSTEMIC RISK & CHAPTER 11 Stephen J. Lubben*
    SYSTEMIC RISK & CHAPTER 11 Stephen J. Lubben* The systemic risk to the automotive industry and the overall U.S. economy are [sic] considerable, just as the bankruptcy of Lehman had a ripple effect throughout the financial industry. Based upon exhaustive analysis, these risks outweigh the benefits of a bankruptcy based approach to the Company’s restructuring.1 I. INTRODUCTION The U.S. economy lost more than 650,000 jobs in February of 2009, and the unemployment rate hit eight percent, the highest rate since the early Reagan administration.2 It would have seemed inconceivable six months ago to consider General Electric (“GE”) a risky investment, but as of this writing, GE is trading in the credit default swap (“CDS”) market3 with “points upfront,” typically an indication of a high near-term probability of default.4 In early September of 2008, just before Lehman Brothers entered bankruptcy, there were about seventy-five companies trading “upfront.” By March of 2009, the number was 260.5 In this context, chapter 11 is notable in its absence. Chapter 11 is the thing that wrecked Lehman Brothers and perhaps the credit markets.6 It is the thing that the Federal Reserve and Treasury worked so hard to keep AIG and Bear Stearns * Daniel J. Moore Professor of Law, Seton Hall University School of Law. 1. GEN. MOTORS CORP., 2009–2014 RESTRUCTURING PLAN 103 (2009), available at http://graphics8. nytimes.com/packages/pdf/business/20090217GMRestructuringPlan.pdf. 2. Peter S. Goodman & Jack Healy, Job Losses Hint at Vast Remaking of U.S. Economy, N.Y. TIMES, Mar.
    [Show full text]
  • The Return of Deregulation and Trickle-Down Economics in the Age of Trump: Why the Efficient Market Hypothesis Refuses to Die and the Implications for U.S
    THE RETURN OF DEREGULATION AND TRICKLE-DOWN ECONOMICS IN THE AGE OF TRUMP: WHY THE EFFICIENT MARKET HYPOTHESIS REFUSES TO DIE AND THE IMPLICATIONS FOR U.S. ECONOMIC POLICY AT LARGE Matthew Glass Abstract The 2008 market collapse created economic devastation not seen in the United States since the Great Depression. More than a decade later, the reappearance of a fiscal agenda rooted in deregulation and trickle-down economics risks a return to the boom and bust cycles that have unfailingly wrought great economic pain on the American people. The ever-increasing inequality gap between the rich and poor is particularly concerning. I. Introduction As more than a decade has passed since the height of the 2008 financial crisis, it seems many of the prevailing views that dominated Wall Street before the market’s collapse are beginning to return in vogue, most notably, deregulation and trickle- down economics. At the heart of the belief that massive regulation is what ails the U.S. economy, there seems to be a recurrence of the hyperbolic rhetoric that mirrors the prior peaks of the Efficient Market Hypothesis (“EMH”) gone awry.1 Believing that highly efficient markets are great for a country’s economy is far different from believing in “perfectly rational” markets. Time and time again, this philosophy has proven to be correlated with the massive financial crises in the United States and around the world.2 Underlying this phenomenon is the crux of the issue—a blanket faith in wholly rational markets almost always is accompanied by a deregulation J.D., with a specialized concentration in international law, 2018, Shepard Broad College of Law at Nova Southeastern University; B.S.
    [Show full text]