The Fear Economy - By PAUL KRUGMAN

[kpete]

The Fear Economy
By PAUL KRUGMAN
Published: December 26, 2013

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When the economy is strong, workers are empowered. They can leave if they’re unhappy with the way they’re being treated and know that they can quickly find a new job if they are let go. When the economy is weak, however, workers have a very weak hand, and employers are in a position to work them harder, pay them less, or both.

Is there any evidence that this is happening? And how. The economic recovery has, as I said, been weak and inadequate, but all the burden of that weakness is being borne by workers. Corporate profits plunged during the financial crisis, but quickly bounced back, and they continued to soar. Indeed, at this point, after-tax profits are more than 60 percent higher than they were in 2007, before the recession began. We don’t know how much of this profit surge can be explained by the fear factor — the ability to squeeze workers who know that they have no place to go. But it must be at least part of the explanation. In fact, it’s possible (although by no means certain) that corporate interests are actually doing better in a somewhat depressed economy than they would if we had full employment.

What’s more, I don’t think it’s too much of a stretch to suggest that this reality helps explain why our political system has turned its backs on the unemployed. No, I don’t believe that there’s a secret cabal of C.E.O.’s plotting to keep the economy weak. But I do think that a major reason why reducing unemployment isn’t a political priority is that the economy may be lousy for workers, but corporate America is doing just fine.

And once you understand this, you also understand why it’s so important to change those priorities.

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Too many Americans currently live in a climate of economic fear. There are many steps that we can take to end that state of affairs, but the most important is to put jobs back on the agenda.


The Rest:
http://www.nytimes.com/2013/12/27/opinion/krugman-the-fear-economy.html?smid=tw-NytimesKrugman&seid=auto&_r=1&

[LisaLynne]

1. I totally agree that if corporate America isn't hurting, then ...

the vast majority of politicians see no reason to change anything. It's like anything outside of the corporations doesn't really exist.

[fasttense]

2. The capitalistic plutocracy is firmly entrenched in the seat of power

Democracy has disappeared in America and in its place the plutocracy of uber rich old white men took over.

They want a very few handful of uber rich white men in charge, a very small middle class to do their taxes, take care of their sick and haggle over minor legal issues, and a huge mass of starving working poor to do everything else their fat lazy asses can't do.

[mountain grammy]

4. +1000

[hootinholler]

3. Why isn't this guy the Chair of the Fed?

Or Sec of Treasury

Or at this point I'd even let him be Atty General.