Free Markets, Free People

Daily Archives: November 29, 2011

Takin’ it too the streets!

Professor Cornel West, who most likely wouldn’t have a job if he an others weren’t able to keep race baiting going, has emphatically stated that entitlements need to be increased, not decreased.  And he’s also made the point that if they aren’t, well, those seeking to have them increased may have to take to the streets:

"I think the problem is that the poor children, keep in mind it’s 42% of poor children who live at or near poverty, it’s 25% in poverty. Our audience needs to keep that in mind." Cornel West said on MSNBC this afternoon.

"Poor children need more than just a $1,000 for their family, they need a war against poverty to make it a major priority in the way which we have a priority for Afghanistan, and a priority to bail out banks, and a priority to defend corporate interests when it comes to environmental issues," West said about more and new entitlements for the poor.

Professor West didn’t just call for another war on poverty (the first war was fought by Lyndon B. Johnson), but went on to say that the push for more entitlements "is going to be fought in the streets." West showered the Occupy movement with praise for making people aware of the issue.

"It’s a major question of priorities here. That’s why the Occupy movement is so important because some of this is going to be fought in the streets. Civil disobedience does make a difference," he said.

A few points.   Poverty in the US is unlike poverty anywhere else.   If you’ve ever traveled outside the US to a third world country you know what real poverty looks like.  The Heritage Foundation gives us a little reminder of what those who are deemed “poor” in the US are likely to have (from the Census Bureau):

  • 80 percent of poor households have air conditioning
  • Nearly three-fourths have a car or truck, and 31 percent have two or more cars or trucks
  • Nearly two-thirds have cable or satellite television
  • Two-thirds have at least one DVD player and 70 percent have a VCR
  • Half have a personal computer, and one in seven have two or more computers
  • More than half of poor families with children have a video game system, such as an Xbox or PlayStation
  • 43 percent have Internet access
  • One-third have a wide-screen plasma or LCD television
  • One-fourth have a digital video recorder system, such as a TiVo

As for  the claims about hunger and homelessness:

As for hunger and homelessness, Rector and Sheffield point to 2009 statistics from the U.S. Department of Agriculture showing that 96 percent of poor parents stated that their children were never hungry at any time during the year because they could not afford food, 83 percent of poor families reported having enough food to eat, and over the course of a year, only 4 percent of poor persons become temporarily homeless, with 42 percent of poor households actually owning their own homes.

In fact, in the US, poverty is more of a definition than a condition.   And that definition is key, because if you fit it, then you are “entitled” to taxpayer largess.  So painting a bleak picture of poverty in the US in general terms is important to any argument for increased entitlements, even when everyone should know that we can’t afford them. 

Those who’s power is based in their advocacy for the poor see that as a threat.  So they’re left with either accepting the fact that their power will be diminished or threatening to resort to “civil disobedience”.  The reason West likes OWS is because that’s the sort of action he wants to see.  Tantrums in the street designed to get what they want.

And that brings me to point two – civil disobedience in today’s parlance isn’t the same as it was in Dr. King’s day.  OWS makes that clear.   Any demonstration today, even if the intent is non-violence, always attracts a violent faction.   West’s praise of the OWS isn’t just focused on awareness.  The methods they’ve used are fine with him too.  Provocation which eventually turns to violence.

Finally … it is also about holding corporations hostage.  This was a technique refined by Jesse Jackson.  Make the villain evil and greedy corporations.  Threaten them with direct action.  Make ‘em pay.  

So what you see West setting up here is part Jesse Jackson sting operation and part poverty pimping.   As we know from the previous “war on poverty” which wasted trillions and never moved the poverty percentage down a single percentage point, government intervention has been a failure.  So unwilling to be solely dependent on government (taxpayer) largess which, given the sad state of government finances, is unlikely to be increased, West is setting up the next patsy.

The Jesse Jackson model will meet OWS and instead of taxpayers paying the price this time, it will be consumers who will foot the bill while a new generation of poverty pimps use those defined as “poor” as their means of holding up corporations.

But first, the demonization must proceed.    And if you’ve been paying attention, you know that is well underway via OWS and the Democrats.

~McQ

Twitter: @McQandO

Economic Statistics for 29 Nov 11

Today’s economic statistical releases:

The Conference Board’s consumer confidence index jumped sharply upwards, from 39.8 to 56, mainly on employment optimism.

Distress sales and foreclosures seem to be pushing the housing sector deeper into contraction. The S&P Case-Shiller home price index fell again, -0.6% for the month, and -3.6% for the year. On the other hand, the FHFA  reports housing prices rose 0.9% last month, though they’re still down -2.2% on a year over year basis. But, the FHFA only reports on conventional loans or those bundled by government agencies—which often has price caps. Case-Schiller is far more broad, and the FHFA picture is probably missing a lot of trouble in the housing sector.

The State Street Investor Confidence Index rose 2 points to 97.2 from a revised 95.2 last month, as institutional investors became a bit more jaunty.

Finally in retail sales, Redbook reports a year-over-year jump of 5.4% in sales last week. ICSC-Goldman is also strong, with sales up 1.7% for the week, and up 4% over last year.

~
Dale Franks
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Is middle class income stagnation a myth (created by the income inequality crowd)?

The valuable James Pethakoukis weighs in with some new numbers to again shatter one of the myths that surround the “income inequality” nonsense that OWS and its ilk (*cough* Democrats *cough*) are pushing.  One of those myths is that middle class income has “stagnated” in the last 40 years.   And that’s because, per the OWS crowd, the rich have basically stolen taken ended up with the money generated.  Those pushing that premise are citing economists Thomas Piketty and Emanuel Saez study which claims the taxable income of the bottom 99 percent increased by just 12 percent from 1970 to 2008.

That premise and those claims are under serious assault.   In fact, the University of Chicago’s Tino Sanandaji finds that there has been pretty significant growth in middle class income.  His summary of what he found:

My simple method is combining the best income-distribution estimate (from Pickety&Saez) with the best income-growth estimates (from GDP numbers). This method shows that that between 1970-2008 the real per capita income of the “Bottom 99 Percent” grew by 80%, and the income of the “Bottom 90 Percent” grew by 60%.

80%?  Last time I looked that was a bit higher than 12%.   Oh, and plenty of charts, etc., to explain the difference at Pethakoukis’ site.

And there is statistical backup for Sanandaji’s findings:

From 1975-2009, real per capita GDP increased by 90 percent vs. 17 percent growth in real median household income, as measured by the Census Bureau.

On top of that:

These calculations are in line with new research from University of Chicago’s Bruce Meyer and Notre Dame’s James Sullivan, who find that “median income and consumption both rose by more than 50 percent in real terms between 1980 and 2009.”

Conclusion?  If the premise is that one of the reasons that upper income increased in that period is because middle class income stagnated, the premise just isn’t supported by reality.   Income is not a zero-sum game.  And one of the points on the pro side of capitalism is it lifts all boats – as demonstrated here.

~McQ

Twitter: @McQandO