|Posted by Jerrald J President on March 2, 2019 at 6:15 PM||comments (0)|
It's all in the numbers. By JJP
▪ For white households, the median net worth was an estimated $107,000.
▪ For Black-American households, the median net worth was $3,700.
▪ For Black-Caribbean households, the median net worth was $12,000.
Meanwhile, households identifying as Cuban had a median net worth of $22,000.
Haitian, Jamaican or American ... If you’re black in Miami, odds are you’re struggling
A new study sheds light on the yawning gap in wealth in the Miami area between white households and households of color.
Among non-white groups, it is Miami-area households identifying as black that continue to suffer most, according to the authors of the study, “The Color of Wealth in Miami.”
The wealth gap exists across racial background: African-American, Haitian-American, and all other types of black households, the study says.
“If skin complexion is a marker of social treatment, as I believe it to be, then we still have lots of structural barriers related to someone’s phenotype,” said study co-author Darrick Hamilton, a professor of economics and social policy at Ohio State University.
Or as the study’s authors state ominously: Despite Miami’s rise as a cosmopolitan city in the past decade or so, “The concentration of wealth that characterizes modern global cities does not necessarily trickle down to all its residents.”
The study is part of a series chronicling the racial wealth gap in major U.S. metropolitan areas. Previous studies have looked at the gap in Boston, Los Angeles, and the Washington, D.C., area, among other cities. Hamilton said that the black-white wealth gap is most severe in Boston.
So what’s unique about Miami?
Thanks to its particular mix of ethnicities identifying as black, the authors are able to show how skin complexion is most correlated with economic insecurity.
Using new survey data, as well as U.S. Census Bureau data, covering a period between 2013 and 2015, the study’s authors calculated the median net worth for households of various ethnicities in the Miami metropolitan area, comprising Miami-Dade, Broward and Palm Beach counties.
▪ For white households, the median net worth was an estimated $107,000.
▪ For Black-American households, the median net worth was $3,700.
▪ For Black-Caribbean households, the median net worth was $12,000.
Meanwhile, households identifying as Cuban had a median net worth of $22,000.
“U.S. black descendants and black Caribbean descendants, primarily Haitians, Jamaicans, Trinidadians and Tobagonians, and blacks with Latin or Hispanic heritage, are more economically similar than Latins of various ancestral origin who self-identify as white as opposed to black,” the authors write.
For Hamilton, the data show that the experience of being black in Miami is a uniquely difficult one, even accounting for different ethnic or ancestral origins.
“The key takeaway is that when it comes to things like business ownership, home ownership, and household income, the variation based on color is more pronounced than the variation based on ancestral background,” he said.
The authors findings suggest Hispanics seem to grasp the inherent advantage of identifying as white.
“In terms of identification, overwhelmingly, Latin Census respondents self-classify as either racially white or ‘other,’ while a small fraction chose a racially black identity,” the authors write. “Self-reported white Latin individuals attain higher economic outcomes, despite having only slightly higher educational attainment than their racially self-reported black counterparts.”
Indeed, education appeared to do little to close the wealth gap among Miami households of different ethnicities.
▪ For white households with a bachelor’s degree or higher, median net worth was $301,000.
▪ For Hispanic households with a bachelor’s degree or higher, median net worth was $87,500.
▪ For black households with a bachelor’s degree or higher, median net worth was $32,000.
Hamilton says the study offers evidence that what he referred to as “multicultural neoliberalism,” which he said puts forward the belief that different groups’ obstacles or sufferings are equal, but that education can be sufficient to overcome those barriers, needs to be questioned.
“This offers strong context to dispel the myth .. .that we all face the same circumstances, and that if we just pull ourselves up by our bootstraps, we can get ahead.”
In reality, Hamilton and his co-authors find, the gaps are the result of policies, or the lack thereof, that have discriminated against black individuals.
“We must understand the scope of racial differences in resource transfers across generations, with an eye on both historical and present-day policies and practices that enable some groups to gain a relative position advantage over others,” the authors write.
They continue: “Policies are needed that provide opportunities for asset development; fair access to housing, credit, and financial services; opportunity for good-paying jobs; strengthening retirement incomes; promoting access to education without overburdening individuals with debt; and providing access to health care while helping minimize medical debt.”
The report is a joint publication of The Kirwan Institute for the Study of Race and Ethnicity at The Ohio State University, Samuel Dubois Cook Center on Social Equity at Duke University, and the Insight Center for Community Economic Development. The lead author was Alan A. Aja, an associate professor in the Department of Puerto Rican and Latino Studies at Brooklyn College.
|Posted by Jerrald J President on January 27, 2019 at 11:40 PM||comments (0)|
Every year the numbers of billionaires increases, while the politicians they control/finance tell US everything is fine. By JJP
World's 26 richest people own as much as poorest 50%, says Oxfam
Charity calls for 1% wealth tax, saying it would raise enough to educate every child not in school
The growing concentration of the world’s wealth has been highlighted by a report showing that the 26 richest billionaires own as many assets as the 3.8 billion people who make up the poorest half of the planet’s population
In an annual wealth check released to mark the start of the World Economic Forum in Davos, the development charity Oxfam said 2018 had been a year in which the rich had grown richer and the poor poorer.
It said the widening gap was hindering the fight against poverty, adding that a wealth tax on the 1% would raise an estimated $418bn (£325bn) a year – enough to educate every child not in school and provide healthcare that would prevent 3 million deaths.
Oxfam said the wealth of more than 2,200 billionaires across the globe had increased by $900bn in 2018 – or $2.5bn a day. The 12% increase in the wealth of the very richest contrasted with a fall of 11% in the wealth of the poorest half of the world’s population.
As a result, the report concluded, the number of billionaires owning as much wealth as half the world’s population fell from 43 in 2017 to 26 last year. In 2016 the number was 61.
Among the findings of the report were:
In the 10 years since the financial crisis, the number of billionaires has nearly doubled.
Between 2017 and 2018 a new billionaire was created every two days.
The world’s richest man, Jeff Bezos, the owner of Amazon, saw his fortune increase to $112bn. Just 1% of his fortune is equivalent to the whole health budget for Ethiopia, a country of 105 million people.
The poorest 10% of Britons are paying a higher effective tax rate than the richest 10% (49% compared with 34%) once taxes on consumption such as VAT are taken into account.
Oxfam’s director of campaigns and policy, Matthew Spencer, said: “The massive fall in the number of people living in extreme poverty is one of the greatest achievements of the past quarter of a century but rising inequality is jeopardising further progress.
“The way our economies are organised means wealth is increasingly and unfairly concentrated among a privileged few while millions of people are barely subsisting. Women are dying for lack of decent maternity care and children are being denied an education that could be their route out of poverty. No one should be condemned to an earlier grave or a life of illiteracy simply because they were born poor.
“It doesn’t have to be this way – there is enough wealth in the world to provide everyone with a fair chance in life. Governments should act to ensure that taxes raised from wealth and businesses paying their fair share are used to fund free, good-quality public services that can save and transform people’s lives.”
The report said many governments were making inequality worse by failing to invest enough in public services. It noted that about 10,000 people per day die for lack of healthcare and there were 262 million children not in school, often because their parents were unable to afford the fees, uniforms or textbooks.
Oxfam said governments needed to do more to fund high-quality, universal public services through tackling tax dodging and ensuring fairer taxation, including on corporations and the richest individuals’ wealth, which it said were often undertaxed.
A global wealth tax has been called for by the French economist Thomas Piketty, who has said action is needed to arrest the trend in inequality.
The World Inequality Report 2018 – co-authored by Piketty – showed that between 1980 and 2016 the poorest 50% of humanity only captured 12 cents in every dollar of global income growth. By contrast, the top 1% captured 27 cents of every dollar.
Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk
Oxfam said that in addition to tackling inequality at home, developed nations currently failing to meet their overseas aid commitments could raise the missing billions needed to tackle extreme poverty in the poorest countries by increasing taxes on extreme wealth.
China’s rapid growth over the past four decades has been responsible for much of the decline in extreme poverty but Oxfam said World Bank data showed the rate of poverty reduction had halved since 2013. In sub-Saharan Africa, extreme poverty was on the increase.
Oxfam said its methodology for assessing the gap between rich and poor was based on global wealth distribution data provided by the Credit Suisse global wealth data book, covering the period from June 2017 to June 2018. The wealth of billionaires was calculated using the annual Forbes billionaires list published in March 2018.
• This article was amended on 21 January 2019 to clarify that the figure of 10,000 people dying for lack of healthcare is per day.
As 2019 begins…
… we’re asking readers to make a new year contribution in support of The Guardian’s independent journalism. More people are reading and supporting our independent, investigative reporting than ever before. And unlike many news organisations, we have chosen an approach that allows us to keep our journalism accessible to all, regardless of where they live or what they can afford. But this is only possible thanks to voluntary support from our readers – something we have to maintain and build on for every year to come.
Readers’ support powers The Guardian, giving our reporting impact and safeguarding our essential editorial independence. This means the responsibility of protecting independent journalism is shared, enabling us all to feel empowered to bring about real change in the world. Your support gives Guardian journalists the time, space and freedom to report with tenacity and rigor, to shed light where others won’t. It emboldens us to challenge authority and question the status quo. And by keeping all of our journalism free and open to all, we can foster inclusivity, diversity, make space for debate, inspire conversation – so more people, across the world, have access to accurate information with integrity at its heart. Every contribution we receive from readers like you, big or small, enables us to keep working as we do.
The Guardian is editorially independent, meaning we set our own agenda. Our journalism is free from commercial bias and not influenced by billionaire owners, politicians or shareholders. No one edits our editor. No one steers our opinion. This is important as it enables us to give a voice to those less heard, challenge the powerful and hold them to account. It’s what makes us different to so many others in the media, at a time when factual, honest reporting is critical.
Please make a new year contribution today to help us deliver the independent journalism the world needs for 2019 and beyond.
|Posted by Jerrald J President on January 19, 2019 at 3:05 PM||comments (0)|
Separately, the study noted, “Between 1983 and 2016, the median Black family saw their wealth drop by more than half after adjusting for inflation, compared to a 33% increase for the median White household.” At present, the median Black family has assets of $3,600, roughly 1/4oth that of the median White household, the institute reports.
We have to be honest with our plight, and be honest with our reality. By JJP
Members Of The Forbes 400 Hold More Wealth Than All U.S. Black Families Combined, Study Finds
Wealth concentration in the United States—which is intensifying across the board—has impacted minority groups the hardest.
That is the thesis of a new report from the Institute for Policy Studies, a left-leaning think tank based in Washington, D.C.
Utilizing data from the Federal Reserve, Bureau of Labor Statistics and Forbes rich lists, among other sources, the institute found that the 400 richest Americans hold more wealth than “all Black households, plus a quarter of Latino households [combined].”
Separately, the study noted, “Between 1983 and 2016, the median Black family saw their wealth drop by more than half after adjusting for inflation, compared to a 33% increase for the median White household.” At present, the median Black family has assets of $3,600, roughly 1/4oth that of the median White household, the institute reports.
Institute for Policy Studies
Among the study’s other striking conclusions:
Black families are about 20 times more likely to have zero or negative assets (indebted) than they are to be worth $1 million or more. Latino households are 14 times more likely to have zero or negative assets than they are to be millionaires. Meanwhile, white households are equally likely to fall into either category.
The wealth of the median Latino family rose 54% between 1983 and 2016, to $6,600. Still, the wealth of typical Latino household is 1/22nd that of the median white household.
The Bottom Line Of Orientation And Acculturation In Successful Organizations: How Do You Get There?
“Wealth is where the past shows up in the present. From slavery to Jim Crow, to redlining, to mass incarceration, the division of assets on the basis of race has been explicit public policy for centuries,” says Josh Hoxie, one of the study’s co-authors.
International disparities resemble those in the United States. Of the 2,043 individuals who made Forbes’ 2018 list of the World’s Billionaires, just 11 were black. Additionally, a 2018 Oxfam analysis found that the world’s 42 richest people hold as much wealth as the poorest 3.7 billion people combined.
The Institute for Policy Studies’ latest report emphasizes that wealth concentration in the U.S. is increasing across demographics. For instance, the three richest Americans—Jeff Bezos, Bill Gates and Warren Buffett—hold more wealth than the bottom 50% of the country combined, the institute says. That statistic mirrors the barrier to entry for The Forbes 400. In 1982, the list’s inaugural year, the minimum net worth was $100 million. This year the cutoff hit an all-time high of $2.1 billion.
Inversely, a 2017 Federal Reserve report found that 40% of adults would not have the cash to cover an unexpected expense of $400. The same report found than one in five adults cannot pay all of their monthly bills, while more than a quarter skip necessary medical care because they can’t afford it.
Some billionaires, including Bill Gates, have acknowledged the significance of wealth and income inequality. “High levels of inequality are a problem—messing up economic incentives, tilting democracies in favor of powerful interests, and undercutting the ideal that all people are created equal,” Gates wrote in a 2014 blog post. His wife, Melinda, echoed the sentiment in their foundation's 2018 annual letter: "It's not fair that we have so much wealth when billions of others have so little. And it's not fair that our wealth opens doors that are closed to most people."
For his part, Warren Buffett cites “an advanced market-based economy” for the gap between the rich and the poor. Still, he wrote in a 2015 op-ed, “The poor are most definitely not poor because the rich are rich. Nor are the rich undeserving.”
Reversing current trends is proving difficult. Proposals range from establishing bonds for young children, to guaranteeing a basic income, to raising the estate tax, to expanding access to affordable medical care and housing—any of which is guaranteed to be politically explosive. Identifying a problem is often easier than fixing it.
|Posted by Jerrald J President on January 19, 2019 at 3:00 PM||comments (0)|
"Between 1983 and 2016, the median Black family saw their wealth drop by more than half after adjusting for inflation, compared to a 33 percent increase for the median White household. Over that same period, the number of households with $10 million or more skyrocketed by 856 percent." Gangster Capitalism 101
Dreams Deferred: How Enriching the 1% Widens the Racial Wealth Divide
A new report released by the Institute for Policy Studies highlights how a polarizing racial wealth divide has grown between White households and households of color over the past three decades.
January 14, 2019
by Dedrick Asante-Muhammad Chuck Collins and Josh Hoxie Sabrina Terry
January 15, 2019, the release date of this report, would have been the 90th birthday of Dr. Martin Luther King, Jr. Dr. King envisioned a future in which deep racial inequalities were eradicated and he worked tirelessly towards that mission. His tragic assassination occurred while he was organizing the Poor Peoples Campaign, his last great effort to ensure economic justice as a cornerstone of civil rights.
In light of Dr. King’s pursuit of economic justice, this report highlights how historic racial wealth disparities have been perpetuated and increased by the trend towards extreme inequality in the United States. It also puts the racial wealth divide in the context of overall wealth inequality trends.
Download the Full Report
Enriching the 1 Percent Widens the Racial Wealth Divide
This report looks at the trends in household wealth among Black, Latino and White households over the past three decades. It relies on data from the Federal Reserve Board’s most recent triannual Survey of Consumer Finances. The Racial Wealth Divide Over the past three decades, a polarizing racial wealth divide has grown between White households and households of color. Since the early 1980s, median wealth among Black and Latino families has been stuck at less than $10,000. Meanwhile, White household median wealth grew from $105,300 to $140,500, adjusting for inflation.
The Racial Wealth Divide
Over the past three decades, a polarizing racial wealth divide has grown between White households and households of color. Since the early 1980s, median wealth among Black and Latino families has been stuck at less than $10,000. Meanwhile, White household median wealth grew from $105,300 to $140,500, adjusting for inflation.
Between 1983 and 2016, the median Black family saw their wealth drop by more than half after adjusting for inflation, compared to a 33 percent increase for the median White household. Over that same period, the number of households with $10 million or more skyrocketed by 856 percent.
The median Black family today owns $3,600— just 2 percent of the $147,000 of wealth the median White family owns. The median Latino family has assets worth $6,600 — just 4 percent as much as the median White family. In other words, the median White family has 41 times more wealth than the median Black family and 22 times more wealth than the median Latino family.
If the trajectory of the past three decades continues, by 2050 the median White family will have $174,000 of wealth, while Latino median wealth will be $8,600 and Black median wealth will be $600. The median Black family is on track to reach zero wealth by 2082.
If current trends continue, it would take the typical Black family over 52 million years to reach the wealth of the Walton family today and Latino families 24 million years.
The proportion of all U.S. households with zero or “negative” wealth, meaning their debts exceed the value of their assets, has grown from 1 in 6 in 1983 to 1 in 5 households today. Families of color are much likelier to be in this precarious financial situation. Thirty-seven percent of Black families and 33 percent of Latino families have zero or negative wealth, compared to just 15.5 percent of White families. One piece of good news: the proportion of Latino families with zero or negative net worth dropped 19 percent between 1983 and 2016, from 40 percent to 33 percent.
Black families are about 20 times more likely to have zero or negative wealth (37 percent) than they are to have $1 million or more in assets (1.9 percent). Latino families are 14 times more likely to have zero or negative wealth (32.8 percent) than they are to reach the millionaire threshold (2.3 percent). White families are equally likely to have zero or negative wealth (about 15 percent) as they are to be a millionaire (15 percent).
Low levels of Black and Latino wealth, combined with their growing proportion of the population, is a key factor in the overall decline in American median household wealth from $84,111 in 1983 to $81,704 in 2016.
In a Deeply Unequal Economy
The widening of the racial wealth divide has coincided with the extreme concentration of U.S. wealth. The wealthiest 0.1 percent of households have grown richer while millions of families face poverty and deep-seated economic insecurity.
The median American family saw their wealth drop 3 percent between 1983 and 2016, while the richest 0.1 percent have seen their wealth jump 133 percent.
During this same period, the annual increase for White median family wealth was about $1,000. Latino median family wealth went up by $66 annually and Black median family wealth dropped $83 annually. Meanwhile, the average household in the top 1 percent saw their wealth jump by half a million dollars annually.
The richest dynastic families in the United States have seen their wealth expand at a dizzying pace. The three wealthiest families — the Waltons, the Kochs, and the Mars — have seen their wealth increase nearly 6,000 percent since 1983.
The Forbes 400 richest Americans own more wealth than all Black households plus a quarter of Latino households.
Jeff Bezos, founder of Amazon, owns $160 billion in total wealth. That is 44 million times more wealth than the median Black family and 24 million times more wealth than the median Latino family.
The racial wealth divide and growing economic inequality is often analyzed as two separate and concurrent trends, when in fact, they are mutually reinforcing outcomes of larger economic issues. Both the racial wealth divide and the unequal economy were created and perpetuated by public policies that favored Whites and continue to favor the very wealthy. Public policies aimed at reducing both trends will be critical to creating a more equitable economic system and a more just society overall. Such policies could include, but are not limited to:
A baby bond program to help low-wealth households build wealth
A tax on the wealthiest 0.1 percent to reduce distortions caused by concentrated wealth and generate revenue marked for expanding opportunity for low-wealth households
An audit of federal government policies to evaluate their impact on the racial wealth divide
Targeted reparations to address the legacy of racism in wealth building
Dreams Deferred expands on and updates two previous reports from the Program on Inequality and the Common Good at the Institute for Policy Studies, in collaboration with Prosperity Now: “The Ever-Growing Gap: Failing to Address the Status Quo Will Drive the Racial Wealth Divide for Centuries to Come,” in 2016, and “The Road to Zero Wealth: How the Racial Wealth Divide is Hollowing Out America’s Middle Class” in 2017. This report also builds on extensive research on the growing concentration of wealth in the United States catalogued in the “Billionaire Bonanza” report series released in 2015, 2017, and 2018. The most recent edition focused on the growing power and influence of intergenerational wealth dynasties.
Too often Dr. King’s “Dream” of making justice a reality for people of color is conflated with the “fantasy of self-deception” that there is “steady growth toward a middle-class utopia.” Examining the concentration of wealth and ongoing deep racial wealth inequality in light of Dr. King’s 90th birthday reminds us of the reality King spoke of in his famous “I Have A Dream Speech”: “the Negro lives on a lonely island of poverty in the midst of a vast ocean of material prosperity.”
Dr. King also stated in this speech that “America has given the Negro people a bad check, a check which has come back marked ‘insufficient funds.” Over 50 years since this famous dream was shared with the nation, we have seen wealth concentrate among the wealthiest Americans and a polarizing racial wealth divide grow between Whites and Blacks and Latinos.
Despite aspirant rhetoric and sensationalized media stories, the racial wealth divide has not improved over the past three decades. In fact, the divide has grown considerably as wealth continues to concentrate at the top leaving the rest of the country an increasingly smaller share. A targeted set of policies is imperative to begin to bridge this deep divide for generations to come. Inaction or, worse, repeating the same mistakes that led to this situation will simply widen further the divide and create greater economic instability for the country at large.
Read the full report.
Please direct all media inquiries to Jessicah Pierre at firstname.lastname@example.org.
Chuck Collins directs the Program on Inequality and the Common Good at the Institute for Policy Studies, where he also co-edits Inequality.org. His most recent book is Is Inequality in America Irreversible? from Polity Press and in 2016 he published Born on Third Base: A One Percenter Makes the Case for Tackling Inequality, Bringing Wealth Home, and Committing to the Common Good.
Dedrick Asante-Muhammad is the director of the Bridging the Divide project at the Institute for Policy Studies where he is an Associate Fellow. He is also principal at Race, Wealth And Opportunity, LLC. He was previously the Senior Fellow the Racial Wealth Divide Project at Prosperity Now and hosts the Race and Wealth Podcast.
|Posted by Jerrald J President on December 5, 2018 at 8:20 AM||comments (0)|
All around America same song!!! By JJP
Fed Says Millennials Are Just Like Their Parents. Only Poorer
Millennials, long presumed to have less interest in the nonstop consumption of goods that underpins the American economy, might not be that different after all, a new study from the Federal Reserve says.
Their spending habits are a lot like the generations that came before them, they just have less money at this point in their lives, the Fed study found. The group born between 1981 and 1997 has fallen behind because many of them came of age during the financial crisis.
“We find little evidence that millennial households have tastes and preference for consumption that are lower than those of earlier generations, once the effects of age, income, and a wide range of demographic characteristics are taken into account,” wrote authors Christopher Kurz, Geng Li and Daniel J. Vine.
Their findings are grounded in an analysis of spending, income, debt, net worth, and demographic factors among different generations. The conclusion that millennials aren’t all that different also holds for the researchers’ more granular examination of expenditures on cars, food, and housing.
“It primarily is the differences in average age and then differences in average income that explain a large and important portion of the consumption wedge between millennials and other cohorts,” they conclude.
So much for the young folks favoring "experiences" over tangible goods.
Millennials aren’t unique when it comes to what they spend their money on, either. The report finds that shifts in expenditure shares between different goods and services have been broadly consistent regardless of age. Housing and food are two areas where millennials have spent less than previous generations, with the younger cohort paying more for education. As a caveat, spending on avocado toast wasn’t specifically tracked for this analysis.
What’s old is new again. The paper observes that some of the millennials’ parents were subject to similar baseless grumbles of "kids these days" from their elders.
“A similar question was posed 20 years ago when Baby Boomer profligacy was being compared to the Silent Generation’s penchant for saving,” they wrote. “Speaking to that debate, Sabelhaus and Manchester (1995) were able to separate fact from popular myth at the time and provided evidence that consumption had not increased as much as income, and that Baby Boomer asset accumulation had in fact outpaced that of the previous generation.”
|Posted by Jerrald J President on December 5, 2018 at 7:55 AM||comments (0)|
"50 percent of wage earners had net compensation less than or equal to the median wage, which is estimated to be $31,561.49 for 2017". By JJP
Wage Statistics for 2017
The national average wage index (AWI) is based on compensation (wages, tips, and the like) subject to Federal income taxes, as reported by employers on Forms W-2. Beginning with the AWI for 1991, compensation includes contributions to deferred compensation plans, but excludes certain distributions from plans where the distributions are included in the reported compensation subject to income taxes. We call the result of including contributions, and excluding certain distributions, net compensation. The table below summarizes the components of net compensation for 2017.
Net compensation components for 2017 Compensation subject to Federal income taxes $7,688,538,291,676.52
Net compensation 7,982,655,109,292.13
a Wages on which contributions were paid by 59,178,407 workers.
b Distributions, to the extent included in reported wages (see text above), paid to 59,539 workers.
The "raw" average wage, computed as net compensation divided by the number of wage earners, is $7,982,655,109,292.13 divided by 165,438,239, or $48,251.57. Based on data in the table below, about 67.4 percent of wage earners had net compensation less than or equal to the $48,251.57 raw average wage. By definition, 50 percent of wage earners had net compensation less than or equal to the median wage, which is estimated to be $31,561.49 for 2017.
|Posted by Jerrald J President on December 5, 2018 at 7:40 AM||comments (0)|
Tha proverbial canary in the mine is here America. By JJP
General Motors is laying off 15 percent of its salaried workers and shuttering five plants in North America, the Detroit automaker announced on Monday.
Interested in General Motors?
Add General Motors as an interest to stay up to date on the latest General Motors news, video, and analysis from ABC News.
The company said it was "transforming its global workforce to ensure it has the right skill sets for today and the future, while driving efficiencies through the utilization of best-in-class tools."
These cuts, as planned, will result in about 14,000 layoffs in North America. That breaks down into 8,000 white-collar workers, (some of whom will be offered buyouts) and 6,000 factory workers across North America, although some could transfer to other plants, according to GM.
Barring an agreement between the United Auto Workers union and GM, these plans will move forward and the five plants will close its doors by the end of 2019.
PHOTO: The General Motors assembly plant in Oshawa, Ontario, Canada, Nov. 26, 2018.Carlos Osorio/Reuters
The General Motors assembly plant in Oshawa, Ontario, Canada, Nov. 26, 2018.
(MORE: The Trump Economy: How steelworkers view the midterm elections)
"The actions we are taking today continue our transformation to be highly agile, resilient and profitable, while giving us the flexibility to invest in the future,” GM Chair and CEO Mary Barra said. “We recognize the need to stay in front of changing market conditions and customer preferences to position our company for long-term success."
PHOTO: The General Motors assembly plant in Oshawa, Ontario, Canada, Nov. 26, 2018.Carlos Osorio/Reuters
The General Motors assembly plant in Oshawa, Ontario, Canada, Nov. 26, 2018.
President Trump, who said he spoke with Barra, was displeased with the news of the layoffs.
"Not happy about it. Their car is not selling well, so they'll put something else. I have no doubt that in a not-too-distant future, they'll put something else. They better put something else in," Trump said.
(MORE: The Trump Economy: Why new-car prices are approaching record highs)
GM has shifted its focus on electric, ride-sharing and autonomous vehicles while eliminating poor-selling models. Industry insiders and Wall Street have praised the move.
The company "is trying to get ahead of a potential crisis by making cuts now," Michelle Krebs, executive analyst at Autotrader, said, noting that GM is reacting to a weaker market in China and weaker demand in North America, its two biggest markets.
"GM is actually a tad late to adjusting its product line and production capacity to the dramatic car to utility shift. Ford and Fiat Chrysler already revealed their plans to largely abandon traditional cars," Krebs added.
(MORE: Trump 'not happy' about GM layoffs that run counter to his claims of bringing jobs back to US)
The three assembly plants that will close are: Oshawa Assembly in Oshawa, Ontario, Canada, Detroit-Hamtramck Assembly in Detroit, and Lordstown Assembly in Warren, Ohio.
The Detroit plant makes the Chevy Impala, Buick LaCrosse and Cadillac CT6. The Ohio plant makes the Chevy Cruze. The closures jeopardize the production of those models.
"The sales of all those cars are in decline. They need heavy incentives to sell and a lot of those sales go to fleet or rental agencies," Edmunds analyst Ivan Drury told ABC News. "They have heavy competition in those segments -- Cruze is up against Civics and Corollas and they know they’re not winning there."
He added, "The only shock is that a year ago they said they were going to keep all their cars lines."
The closures were opposed by organized labor.
Unifor, Canada's largest union, issued a statement calling on General Motors Canada to keep the plant open past December 2019.
“Oshawa Assembly is GM’s most decorated plant with a highly skilled, committed workforce,” said Unifor National President Jerry Dias. “Additionally, the USMCA provides the Canadian auto industry with firm footing so walking away after a hundred year history of manufacturing makes no sense.”
“Unifor does not accept the closure of the plant as a foregone conclusion,” said Dias.
General Motors workers leave the Oshawa General Motors plant in Oshawa, Ontario, Nov. 26, 2018.
The cuts were lauded as a step toward a more nimble future for the automaker but others expressed concern about a collective loss of industry talent.
"It comes at a tremendous cost to people and the communities which depend upon GM plants for economic sustainability. While this may be a market necessity, I am concerned about the brain drain: a loss of valuable legacy knowledge and experience as long-term GM employees are let go," according to Kelley Blue Book's Rebecca Lindland.
GM stock was trading 5.6 percent higher midday on the news at $37.94 a share.
GM spokeswoman Stephanie Rice told ABC News the planned plant closures and job cuts are not related to recent U.S. government trade or tariff decisions, but acknowledged "headwinds" they're experiencing from rising prices on commodities "that are largely a reaction to the recent trade policy changes."
GM estimates "recent trade policy changes" have cost them $1.4 billion this year alone.
|Posted by Jerrald J President on December 5, 2018 at 7:35 AM||comments (0)|
The house of cards will crumble. By JJP
America's Heavily Levered Companies Layer Loans Over Loans
By Sally Bakewell
and Kelsey Butler
First the companies tapped the loan market. Not long after that, they came back for more.
Corporations like Bausch Health Cos., a drugmaker, telecom provider Sprint Corp. and Applied Systems Inc., an insurance software provider, borrowed again this month after getting financing in the loan market. Their new loans came by layering more debt onto an existing liability, making that older obligation riskier in the process.
This kind of borrowing, known as using incremental debt, has been rampant this year. Companies have secured around $100 billion of these loans so far in 2018 in the U.S., according to data compiled by Bloomberg. That’s the most since at least 2014.
A senior official at the Federal Reserve took the unusual step of expressing concern about incremental loans in a speech last month, noting that proceeds of the borrowings may end up as payouts to private equity owners. In one case, Applied Systems borrowed so much using incremental and regular loans that its private equity owners were able to completely recoup their original investments in the company.
Incremental lending has grown so much in part because investors agreed to allow it in the first place. For much of the year, money managers were so eager to make loans that they would consent to just about any terms, including allowing companies to add on more loans. The growth of incremental debt underscores how permissive lending markets have become, and why so many money managers and rulemakers are watching corporate borrowings warily now.
“Lenders have been providing what feels like unlimited capacity to borrowers to incur additional loans,” said Vince Pisano, a senior analyst at Xtract Research. “A lot of the extra debt is paid out to private equity owners as dividends, so at some point you should be investing in those firms and not the loans.”
U.S. incremental leveraged loans boom this year
Note: 2018 launch volume YTD through Nov. 20; all others full year volume.
Lenders have agreed to a wide range of looser terms as U.S. leveraged loans have grown into a more than $1 trillion market, eclipsing junk bonds. Those weaker protections for investors could be painful during the next credit downturn: Moody’s Investors Service projects that investors will recover just 61 cents on the dollar when first-lien term loans go bad whenever the market turns, well below the historical average rate of 77 cents.
Valuations are relatively high in the loan market, so it makes sense to be "highly selective," Guggenheim’s Scott Minerd wrote in an outlook piece this month. The money manager has been broadly reducing corporate credit exposure to the lowest level since the financial crisis.
Incremental debt is issued under the same terms and documentation as a prior loan. It can make a company riskier for lenders not just by saddling the borrower with more debt, but also by changing the priority of debt repayments. A company, for example, might get an incremental loan that is first in line to be repaid if a company fails, and use the proceeds to refinance a loan that is second in line.
With that refinancing, a company ends up with more debt that’s first in line, reducing recoveries for everyone at the level known as the first lien, and fewer lenders to absorb losses when things go wrong. The crowded first lien is a problem for lenders who have agreed to receive less interest in exchange for taking what they thought would be less risk, said George Goudelias, of Seix Investment Advisors.
“One of the main reasons you’re taking less interest in the first-lien is because you’re first in line to get paid and there’s a debt buffer behind you,” Goudelias said.
When Bausch Health, formerly known as Valeant, borrowed $1.5 billion in the loan market in an incremental deal in November, it said it was using proceeds to buy back unsecured notes. A spokeswoman for Bausch declined to comment. Ring Container Technologies, a maker of containers and packaging, borrowed $65 million earlier this month, in an add-on to its existing $475 million deal. Proceeds will pay down the second lien.
Ring Container didn’t immediately respond to requests for comment, while a spokesman for Bank of America Corp., which led the loan offering, declined to comment. Sprint, which priced a $1.1 billion incremental-loan deal this week, also declined to comment. The telecom company said it was using proceeds for general corporate purposes.
Applied Systems is using a $210 million incremental loan to pay its private equity owners $200 million, a third dividend. Hellman & Friedman bought the Illinois-based
When combined with two previous debt funded dividends of $390 million in October 2017 and $171 million in the year before, the owners will have recouped their entire initial investment in the firm in two years, according to people familiar with the deals, who asked not to be identified discussing a private matter. Applied Systems didn’t immediately respond to requests for comment. Representatives for Hellman & Friedman and JMI declined to comment.
Applied Systems is one of an increasing number of firms using incremental loans for dividends, according to Bloomberg data. This use of proceeds accounted for more than 17 percent of all incremental loans in 2018, up from 15 percent in 2017 and the highest since 2016, the data show. That’s the highest since at least 2015 in dollar terms, at about $17 billion.
Some incremental debt deals have even sought to add a piece of debt that matures ahead of the term loan, effectively subordinating borrowings that would otherwise rank equally in the repayment order, according to Chris Mawn, head of the corporate loan business at investment manager CarVal Investors.
|Posted by Jerrald J President on November 11, 2018 at 9:50 AM||comments (0)|
With a stroke of the pen my so-called rights in America could vanish. By JJP
Constitutional Amendments and Major Civil Rights Acts of Congress Referenced in Black Americans in Congress
P.L.38-11; 13 Stat. 567; P.L. 38-52
13 Stat. 774–775 Abolished slavery and involuntary servitude, except as punishment for a crime. Approved by the 38th Congress (1863–1865) as S.J. Res. 16; ratified by the states on December 6, 1865.
Civil Rights Act of 1866
14 Stat. 27–30 Guaranteed the rights of all citizens to make and enforce contracts and to purchase, sell, or lease property. Passed by the 39th Congress (1865–1867) as S.R. 61.
Fourteenth Amendment 14
Stat. 358–359 Declared that all persons born or naturalized in the U.S. were citizens and that any state that denied or abridged the voting rights of males over the age of 21 would be subject to proportional reductions in its representation in the U.S. House of Representatives. Approved by the 39th Congress (1865–1867) as H.J. Res. 127; ratified by the states on July 9, 1868.
P.L. 40-14; 15 Stat. 346 Forbade any state to deprive a citizen of his vote because of race, color, or previous condition of servitude. Approved by the 40th Congress (1867–1869) as S.J. Res. 8; ratified by the states on February 3, 1870.
First Ku Klux Klan Act
(Civil Rights Act of 1870) 16 Stat. 140–146 Prohibited discrimination in voter registration on the basis of race, color, or previous condition of servitude. Established penalties for interfering with a person’s right to vote. Gave federal courts the power to enforce the act and to employ the use of federal marshals and the army to uphold it. Passed by the 41st Congress (1869–1871) as H.R. 1293.
Second Ku Klux Klan Act
(Civil Rights Act of 1871) 16 Stat. 433–440 Placed all elections in both the North and South under federal control. Allowed for the appointment of election supervisors by federal circuit judges. Authorized U.S. Marshals to employ deputies to maintain order at polling places. Passed by the 41st Congress (1869–1871) as H.R. 2634.
Third Ku Klux Klan Act (1871
) 17 Stat. 13–15 Enforced the 14th Amendment by guaranteeing all citizens of the United States the rights afforded by the Constitution and provided legal protection under the law. Passed by the 42nd Congress (1871–1873) as H.R. 320.
Civil Rights Act of 1875
18 Stat 335–337 Barred discrimination in public accommodations and on public conveyances on land and water. Prohibited exclusion of African Americans from jury duty. Passed by the 43rd Congress (1873–1875) as H.R. 796.
Civil Rights Act of 1957
P.L. 85–315; 71 Stat. 634 Created the six-member Commission on Civil Rights and established the Civil Rights Division in the U.S. Department of Justice. Authorized the U.S. Attorney General to seek court injunctions against deprivation and obstruction of voting rights by state officials. Passed by the 85th Congress (1957–1959) as H.R. 6127.
Civil Rights Act of 1960
P.L. 86–449; 74 Stat. 86 Expanded the enforcement powers of the Civil Rights Act of 1957 and introduced criminal penalties for obstructing the implementation of federal court orders. Extended the Civil Rights Commission for two years. Required that voting and registration records for federal elections be preserved. Passed by the 86th Congress (1959–1961) as H.R. 8601.
Civil Rights Act of 1964
P.L. 88–352; 78 Stat. 241 Prohibited discrimination in public accommodations, facilities, and schools. Outlawed discrimination in federally funded projects. Created the Equal Employment Opportunity Commission to monitor employment discrimination in public and private sectors. Provided additional capacities to enforce voting rights. Extended the Civil Rights Commission for four years. Passed by the 88th Congress (1963–1965) as H.R. 7152.
Voting Rights Act of 1965
P.L. 89–110; 79 Stat. 437 Suspended the use of literacy tests and voter disqualification devices for five years. Authorized the use of federal examiners to supervise voter registration in states that used tests or in which less than half the voting-eligible residents registered or voted. Directed the U.S. Attorney General to institute proceedings against use of poll taxes. Provided criminal penalties for individuals who violated the act. Passed by the 89th Congress (1965–1967) as S. 1564.
Civil Rights Act of 1968
(Fair Housing Act)
P.L. 90–284; 82 Stat. 73 Prohibited discrimination in the sale or rental of approximately 80 percent of the housing in the U.S. Prohibited state governments and Native-American tribal governments from violating the constitutional rights of Native Americans. Passed by the 90th Congress (1967–1969) as H.R. 2516.
Voting Rights Act
Amendments of 1970
P.L. 91–285; 84 Stat. 314 Extended the provisions of the Voting Rights Act of 1965 for five years. Made the act applicable to areas where less than 50 percent of the eligible voting age population was registered as of November 1968. Passed by the 91st Congress (1969–1971) as H.R. 4249.
Voting Rights Act
Amendments of 1975
P.L. 94–73; 89 Stat. 400 Extended the provisions of the Voting Rights Act of 1965 for seven years. Established coverage for other minority groups including Native Americans, Hispanic Americans, and Asian Americans. Permanently banned literacy tests. Passed by the 94th Congress (1975–1977) as H.R. 6219.
Voting Rights Act
Amendments of 1982
P.L. 97–205; 96 Stat. 131 Extended for 25 years the provisions of the Voting Rights Act of 1965. Allowed jurisdictions that could provide evidence of maintaining a clean voting rights record for at least 10 years, to avoid preclearance coverage (the requirement of federal approval of any change to local or state voting laws). Provided for aid and instruction to disabled or illiterate voters. Provided for bilingual election materials in jurisdictions with large minority populations. Passed by the 97th Congress (1981–1983) as H.R. 3112.
Civil Rights Restoration
Act of 1987
P.L. 100–259; 102 Stat. 28 Established that antidiscrimination laws are applicable to an entire organization if any part of the organization receives federal funds. Passed by the 100th Congress (1987–1989) as S. 557.
Fair Housing Act
Amendments of 1988
P.L. 100–430; 102 Stat. 1619 Strengthened the powers of enforcement granted to the Housing and Urban Development Department in the 1968 Fair Housing Act. Passed by the 100th Congress (1987–1989) as H.R. 1158.
Civil Rights Act of 1991
P.L. 102–166; 105 Stat. 1071 Reversed nine U.S. Supreme Court decisions (rendered between 1986 and 1991) that had raised the bar for workers who alleged job discrimination. Provided for plaintiffs to receive monetary damages in cases of harassment or discrimination based on sex, religion, or disability. Passed by the 102nd Congress (1991–1993) as S. 1745.
Voting Rights Act of 2006
P.L. 109–246; 120 Stat. 577 Extended the provisions of the Voting Rights Act of 1965 for 25 years. Extended the bilingual election requirements through August 5, 2032. Directed the U.S. Comptroller General to study and report to Congress on the implementation, effectiveness, and efficiency of bilingual voting materials requirements. Passed by the 109th Congress (2005–2007) as H.R. 9.
|Posted by Jerrald J President on November 11, 2018 at 9:40 AM||comments (0)|
You think this is a game? These "Descendants of Slave Owners" are not playing. What do you think the mean when they say "The Original Intent of The Constitution"! By JJP
Conservatives call for constitutional intervention last seen 230 years ago
Lawmakers push for ‘constitutional convention’ to restrict federal government – and it’s not as far fetched as it sounds
There is growing confidence a convention could take place, introducing new constitutional amendments: ‘We’re in a battle for the future of our country.’
There is growing confidence a convention could take place, introducing new constitutional amendments: ‘We’re in a battle for the future of our country.’
It’s been more than 230 years since America’s last constitutional convention, but there is growing confidence in some conservative circles that the next one is right around the corner – and could spell disaster for entitlement programs like medicare and social security, as well court decisions like Roe v Wade.
“I think we’re three or four years away,” said the former Oklahoma Senator Tom Coburn on Friday, speaking at the annual convention for American Legislative Exchange Council (Alec) – a powerful rightwing organization that links corporate lobbyists with state lawmakers from across the country.
Coburn, a veteran Republican lawmaker, now works as a senior adviser for the advocacy group Convention of States, which seeks to use a little known clause in article V of the US constitution to call a constitutional convention for new amendments to dramatically restrict the power of the federal government.
Louisiana’s Democratic governor an ally at influential rightwing conference
Coburn, who retired from the Senate in 2010, said that the American republic is “failing”, and that such a convention is the “only answer” to the problems the country faces today.
“We’re in a battle for the future of our country,” Coburn told the assembly of mostly conservative state lawmakers meeting in New Orleans. “We’re either going to become a socialist, Marxist country like western Europe, or we’re going to be free. As far as me and my family and my guns, I’m going to be free.”
Convention of States, with Alec’s support, is one of three prominent conservative groups pushing for a new constitutional convention. Under article V, if two-thirds of state legislatures so choose, they can force congress to convene such a meeting. On the agenda for Convention of States: an amendment to require a balanced budget, term limits for congress, repealing the federal income tax and giving states the power to veto any federal law, supreme court decision or executive order with a three-fifths vote from the states.
“The only chance we have to restore this country, that is peaceful, is this convention,” said Jim Moyer, a Convention of States supporter and attendee at the Alec annual meeting.
It’s not as far fetched as it sounds. A coalition seeking just the balanced budget amendment currently has 28 out of the required 34 state legislatures on board, with active bills calling for a convention. Since Trump’s election, Arizona and Wyoming have both passed bills to join in the call while Maryland, Nevada and New Mexico have repealed versions they had previously put on the books.
We’re either going to become a socialist, Marxist country like western Europe, or we’re going to be free
Senator Tom Coburn
Convention of States and its more expansive to-do list doesn’t have as many states in play as the balanced budget group, but it does boast a big roster of well-known conservative supporters such as Sean Hannity, Sarah Palin, Bobby Jindal and Rand Paul, and a reported 2.5 million volunteers ready to mobilize: “double that of the NRA [National Rifle Association],” pointed out Rita Dunaway, the staff council at Convention of States.
Their partnership with Alec makes success that much more likely. No group in US history has been so successful at getting similar and sometimes nearly identical pieces of legislation passed in multiple states, often within a period of one or two legislative sessions.
Unity among conservatives seeking an article V intervention is paramount. For the convention to be triggered, all 34 states have to ask for the same thing. Once they do though, critics argue the floodgates open. “Once you call a convention literally anybody can bring up anything,” said Jay Riestenberg, a spokesperson for the non-partisan watchdog group Common Cause. “We can bring up an amendment to overturn Roe v Wade or the Civil Rights Act,” Riestenberg added.
Coburn and Dunway both bristled at the possibility of what is known as a “runaway convention”, where conventioneers go beyond their original mandate, perhaps so far as to write an entirely new constitution. This is technically what happened during the framing of the current constitution in 1787, when attendees were tasked with amending the Articles of Confederation, but wound up crafting something new entirely.
Coburn cited the three-fourths barrier – three out of four states need to agree for any proposal made to become law – a firewall to concerns over “runaway”. “All it takes is 13 judiciary chairmen, in 13 states, to stop anything stupid that might come out of that,” Coburn said. “Nothing’s going to happen, I’ll stake my life on that.”
The panelists broadly tabbed “liberals” as the opposition to their hopes, but the politics of an article V convention aren’t so cut and dried. Some of the most virulent opposition to the movement has arisen in the far right John Birch Society which argues that a convention could “rewrite our constitution and destroy its protection of our rights”.
Conversely, some liberal groups have also pushed for an article V convention in response to the supreme court’s 2010 Citizens United ruling as a means to winnow back the influence of money in politics. A group called Wolf Pac leading that charge and has secured legislation in five of the 34 required states.
Tom Buford, a Republican state senator from Kentucky, said he’s been to both of the “simulations” that Convention of States has staged – including one held in 2016 at Colonial Williamsburg complete with period costumes and wigs.
“I support their thought, I’m OK with it, but I’m not the poster child,” Buford said. He thinks some of the proposals, like veto power over the supreme court go too far, and said that decades in state government have shown him the limitations of things like balanced budget amendments.
“A balanced budget amendment is a nice idea, and it will make people feel happy if that amendment were to pass but it wont solve the problem,” Buford said. Kentucky (like every other state besides Vermont) has a balanced budget clause in its state constitution, but lawmakers routinely find ways around.
Since you’re here …
… we have a small favour to ask. More people are reading The Guardian’s independent, investigative journalism than ever but advertising revenues across the media are falling fast. And unlike many news organisations, we haven’t put up a paywall – we want to keep our reporting as open as we can. So you can see why we need to ask for your help.
The Guardian is editorially independent, meaning we set our own agenda. Our journalism is free from commercial bias and not influenced by billionaire owners, politicians or shareholders. No one edits our editor. No one steers our opinion. This is important because it enables us to give a voice to the voiceless, challenge the powerful and hold them to account. It’s what makes us different to so many others in the media, at a time when factual, honest reporting is critical.
|Posted by Jerrald J President on November 11, 2018 at 7:25 AM||comments (0)|
American Gangsterism 101. By JJP
More voters purged from voter rolls between 2014 and 2016: Report
WATCH: High court rules that Congress needs to update the landmark law from 1965.
A recent report from the Brennan Center for Justice found that between 2014 and 2016 states purged almost 16 million voters from the rolls, four million more voters than removed from 2006 to 2008.
Jonathan Brater, a counsel in the nonpartisan center’s Democracy Program and a co-author of the report, said it’s hard to know how many voters were purged in error, “which is part of the concern.”
The 33 percent increase outpaces both population growth and the growth in total registered voters.
While Brater said it was “a little hard to say,” whether the Supreme Court's striking down a key provision of the Voting Rights Act in Shelby County v. Holder caused the increase, the report found that jurisdictions the ruling released from being subject to preclearance under Section 5 of the Voting Rights Act had “significantly higher” rates of purging voters.
Before that ruling, the Voting Rights Act used a formula, developed in the 1960s, to determine which counties would require changes to their election laws to be federally reviewed before they could go into effect.
Last minute voters rush to cast their ballots on Election Day at the Christ United Methodist Church precinct in north Jackson, Miss., Nov. 8, 2016.
In 2013, the Supreme Court ruled that formula unconstitutional because it was outdated and needed to be updated. It called on Congress to rework it, which it has not yet done.
The Brennan Center found that between 2012 and 2016 these jurisdictions removed nine million voters from registration lists and that the removal rate in these places was 2 percent higher than in other areas.
Two million fewer people would have been removed from voter rolls if the rates were equal, researchers found.
While they were also unable to determine the percent of voters mistakenly removed in these districts, the Brennan Center found that as the rates of voters removed increased, so did the number of people who showed up to vote but were unable to.
Derrick Johnson, the president and CEO of the NAACP, told ABC News the report is evidence that Section 5 of the Voting Rights Act is crucial to our democracy and questioned the demographics of those purged from voter rolls.
“It is our belief that there is an over-representation of African American, Latino and lower and working-class individuals,” he said. “It is unfortunate that this nation has refused to honor the sacred right to vote and proactively protect that right for all citizens.”
A poll worker hands a voter a, "I'm a Georgia voter," sticker after casting her ballot in Georgia's primary election at Chase Street Elementary in Athens, Ga., May 22, 2018.
Georgia, which has a Republican gubernatorial primary run-off Tuesday and is where Stacey Abrams is running to be the first black woman governor in the nation, was previously subject to preclearance under the Voting Rights Act. The Brennan Center found that between 2012 and 2016 it purged 1.5 million voters.
In an emailed statement, Candice Broce, the press secretary and staff attorney for the Office of Georgia Secretary of State Brian P. Kemp which oversees elections in the state, said "Georgia Secretary of State Brian Kemp is a leader in ensuring that our elections are secure, accessible, and fair for all voters. Robust voter list maintenance is a critical safeguard to maintain the integrity of the ballot box, and when groups have tried to challenge our practices, the courts have upheld our laws to keep the rolls accurate and up-to-date.”
The report also said that states can rely on “faulty” data and that there had been increasing pressure from groups alleging that states were not cleaning voter rolls enough. According to their research, eight states, including New York, Alabama and Maine, had either violated the National Voter Registration Act (NVRA) with one of their purges or had policies that violate the law.
Published last Friday, the report comes a day after former First Lady Michelle Obama announced her "When We All Vote" initiative, using a star-studded cast to encourage voter registration.
It also comes a month after the Supreme Court declared an Ohio law allowing the state to remove people who have not voted in two federal elections constitutional in Husted v. A. Philip Randolph Institute.
To protect voters from aggressive voter roll maintenance, the Brennan Center suggests that states enforce the National Voter Registration Act, enact more protections than required under the act and automatic voter registration.
“We’ve found that a lot of these purges happen in secret and problems are only found on election day when people went to try to vote,” Brater said. “So that’s why it’s critical that states be transparent about what their policies are on purging the voter rolls and that voters check their registration.”
|Posted by Jerrald J President on November 11, 2018 at 7:20 AM||comments (0)|
The mid term elections proved and showed how America has always treated Descendants of Slave. By gutting the 1965 Voters Rights act the desied outcome came to fruition. By JJP
Shelby County v. Holder
August 4, 2018
The Voting Rights Act was passed in 1965 to ensure state and local governments do not pass laws or policies that deny American citizens the equal right to vote based on race. On June 25, 2013, the Supreme Court swept away a key provision of this landmark civil rights law in Shelby County v. Holder.
In April 2010, Shelby County, Alabama filed suit asking a federal court in Washington, DC to declare Section 5 of the Voting Rights Act unconstitutional. Section 5 is a key part of the Voting Rights Act, requiring certain jurisdictions with a history of discrimination to submit any proposed changes in voting procedures to the U.S. Department of Justice or a federal district court in D.C. – before it goes into effect – to ensure the change would not harm minority voters. In September 2011, the U.S. District Court for the District of Columbia upheld the constitutionality of Section 5 of the Voting Rights Act, and in May 2012, the U.S. Court of Appeals for the District of Columbia Circuit agreed with the district court that Section 5 was constitutional. Shelby County appealed the ruling to the Supreme Court, and the Supreme Court agreed to take the case in November 2012.
On June 25, 2013, the Supreme Court ruled that the coverage formula in Section 4(b) of the Voting Rights Act — which determines which jurisdictions are covered by Section 5 — is unconstitutional because it is based on an old formula. As a practical matter this means that Section 5 is inoperable until Congress enacts a new coverage formula, which the decision invited Congress to do. The Brennan Center’s statement on the decision is available here.
The Brennan Center for Justice, alongside many other partner organizations, submitted amicus briefs in the case. All the amicus briefs submitted in the case, including the Brennan Center's brief, alongside the Supreme Court documents can be found in our Shelby County v. Holder case documents page.
|Posted by Jerrald J President on November 11, 2018 at 7:15 AM||comments (0)|
" In April 2010, Shelby County, Alabama filed suit asking a federal court in Washington, DC to declare Section 5 of the Voting Rights Act unconstitutional. Section 5 is a key part of the Voting Rights Act, requiring certain jurisdictions with a history of discrimination to submit any proposed changes in voting procedures to the U.S. Department of Justice or a federal district court in D.C. – before it goes into effect – to ensure the change would not harm minority voters. In September 2011, the U.S. District Court for the District of Columbia upheld the constitutionality of Section 5 of the Voting Rights Act, and in May 2012, the U.S. Court of Appeals for the District of Columbia Circuit agreed with the district court that Section 5 was constitutional. Shelby County appealed the ruling to the Supreme Court, and the Supreme Court agreed to take the case in November 2012"'. Checkmate
How Did the Supreme Court Give a Green Light to Massive Voter Suppression?
Two words: Neil Gorsuch.
When Neil Gorsuch appeared before the Senate Judiciary Committee in 2017 to make a case for his confirmation to serve a life term on the US Supreme Court, Vermont Senator Patrick Leahy observed that, “unless we were asking about fishing or basketball, Judge Gorsuch stonewalled and avoided any substantive response. He was excruciatingly evasive. His sworn testimony and his approach to complying with this Committee’s historic role in the confirmation process have been patronizing. That is a disservice to the American people. And it is a blight on this confirmation process.”
Leahy said the nominee’s evasiveness was a particular concern on the voting-rights issues that were raised during the hearing. Gorsuch, said the chamber’s senior senator, “provided no answer at all to questions regarding the Supreme Court’s decision in Shelby County to gut the Voting Rights Act.” The same went for questions from Leahy and his fellow senators regarding democracy issues. The questions were asked, but Gorsuch did not answer.
Now Justice Gorsuch has answered. On Monday, the Court released its ruling in the case of Hustad v. A. Philip Randolph Institute, an essential test of the Court’s stance regarding voting rights. With the critical 2018 election just months away, the Court’s activist majority gave Republican secretaries of state a go-ahead to resume the antidemocratic practice of purging fully qualified voters from registration rolls.
It was a 5-4 decision. Had Judge Merrick Garland, who was nominated by President Obama to serve on the Court but was then refused a confirmation hearing as part of the machinations by Senate Republican that eventually landed Gorsuch on the high court, it almost certainly would have been different. There is good reason to believe that a Justice Garland would have refused to send the signal that Lawyers’ Committee for Civil Rights Under Law president Kristen Clarke warns is likely to be interpreted “as a green light to purge the registration rolls of legitimately registered voters.”
But Gorsuch sent that signal, siding with four other conservative judicial activists to say that Ohio and other states may conduct aggressive purges of voter rolls, with an eye toward removing the names of qualified voters who have failed to cast ballots in every election. The Ohio process begins by sending address-confirmation notices to voters who have not voted in the past two years. If the voters do not go through the bureaucratic process of returning the notices or otherwise updating their registration data over the ensuing four years, their registrations are tossed.
Justice Sonia Sotomayor pointed out that ruling was fundamentally flawed, noting that the National Voter Registration Act (the so-called “motor-voter law” was enacted to prevent such purges. “Congress enacted the NVRA against the backdrop of substantial efforts by states to disenfranchise low-income and minority voters, including programs that purged eligible voters from registration lists because they failed to vote in prior elections,” explained Sotomayor in a scathing dissent. “The Court errs in ignoring this history and distorting the statutory text to arrive at a conclusion that not only is contrary to the plain language of the NVRA but also contradicts the essential purposes of the statute, ultimately sanctioning the very purging that Congress expressly sought to protect against.”
Unfortunately, Gorsuch and the Court’s activist majority chose to put partisanship ahead of the law.
What this means is that an Ohio voter who may have missed a few local and state elections and a presidential election can show up for the next presidential election and find that their registration has been canceled. It also raises the prospect that even more aggressive purges could be implemented by Republican officials in battleground states where statewide contests are frequently dicided by narrow margins.
“The Supreme Court has just given a stamp of approval to voter suppression,” says Liz Kennedy, the senior director of Democracy and Government Reform for the Center for American Progress. “Ohio’s system of purging voters that choose not to participate in some elections unfairly silences hundreds of thousands of voters in the state, especially people of color and the homeless.”
Vermont Senator Bernie Sanders ripped the ruling, saying, “It’s a travesty that the Supreme Court upheld Ohio’s voter suppression efforts. Instead of making people jump through hoops to vote, states should pass automatic voter registration and same-day registration. Politicians afraid of large voter turnouts are political cowards.”
Congressional Progressive Caucus co-chair Mark Pocan (D-WI) warned that “The Supreme Court just empowered Republican-led states across the country to kick voters off the voting rolls, stifling democracy and creating an unnecessary burden for voters who find that they have been mistakenly and unfairly removed from the rolls. Today’s decision ensures that more voters—especially those that are young, minority, and low-income—will be turned away from the polls and not have their voices heard.”
Support Progressive Journalism
If you like this article, please give today to help fund The Nation’s work.
Pocan has introduced the Voter Roll Integrity Act, legislation designed to prevent states from purging voter rolls “without the knowledge or consent of active and still-eligible voters.” Pocan’s bill would require the use of comprehensive data and a strict confirmation standards to prevent the unfair canceling of registrations.
Calling for immediate consideration of the Voter Roll Integrity Act, the congressman decried Republican governors such as Wisconsin’s Scott Walker for continuing “to commit various forms of voter suppression, all under the guise of eliminating voter fraud.”
Pocan said that elected officials, instead of making up excuses for purging voters from registration rolls, “have a responsibility to do everything we can to empower voters.”
|Posted by Jerrald J President on November 11, 2018 at 7:05 AM||comments (0)|
This is why they just love their military. It's largest PONZI scheme created next to the Federal Bank. By JJP
The Creeping Privatization of America’s Armed Forces
Given the absence of any kind of American grand strategy, rising tensions on the Korean peninsula and all the intrigue and posturing with Russia, it is hard to imagine how international security could get any more complicated.
But as these stories make headlines, another phenomenon grows beneath the surface that is even more concerning.
An increasing number of super-wealthy private citizens own private militaries and are looking for “business” in the Middle East, Africa and around the world.
Since the end of the Cold War, two trends have fed this expansion: 1) the rise of private equity (PE) and 2) the increased dependence of the United States on private military companies/contractors (PMCs).
Since the Berlin Wall came down in 1989, the number of global PE firms has increased from just a few hundred to more than 6,500, and the assets they manage have increased from under $500 million to more than $4.6 trillion.
However, it is not just the number of PE firms or the magnitude of assets under their management that is important, but the very nature of private equity is important to consider here.
Essentially, the owners of PE firms are private citizens, they often buy all of a company’s publicly traded stock (thus taking the company “private”;), their only purpose is to make very high returns on risky investments by drastically cutting costs and boosting revenue because they want to move on to the next investment as quickly as possible, and all of this is done out of the public’s eye.
This is all fine when applied to ketchup and automotive companies. But what about when applied to private military contractors?
The second trend for concern here is the United States’ dependence on contractors to perform military, diplomatic and intelligence functions.
We have used military contractors in every major conflict since the American Revolution. In fact, some Hessians employed by the British defected to the American’s side in return for land and farm animals.
However, according to the Congressional Research Service, within the last few years the U.S.’ dependence on contractors has grown to the point where about half of the U.S. Armed Forces in Iraq and Afghanistan is employed by private military contractors.
In other words, about half of our armed forces is outsourced to private military contractors. These contractors, to include the company formerly known as Blackwater, are now increasingly owned by private equity firms. Thus, American and international security is largely in the hands of private equity partners.
Just to provide a few examples of this overlap: in 1997, Erik Prince, a former Navy SEAL, founded Blackwater. After the 2007 Nisour Square massacre in Iraq in which four of Prince’s employees were convicted, he changed the company’s name to Xe Services. In 2010, he sold the company to two private equity firms for $200 million.
These PE investors renamed the firm ACADEMI, bought two of Blackwater’s competitors, Triple Canopy and Olive Group, then sold all three PMCs in 2016 to the world’s largest private equity firm, Apollo, for an estimated $1 billion.
More recently, Prince has re-entered the industry recruiting a group of Chinese investors and starting his own private equity firm and another PMC. “This is not a patriotic endeavor of ours,” he made clear of his new PE firm’s goals. “We’re here to build a great business and make some money doing it.”
He also said his new firm’s focus was on securing Chinese businesses’ operations in Africa, especially in their efforts to acquire natural resources.
Another example of the private equity-PMC connection includes the 2004 sale of large military contractor DynCorp’s security-related businesses to Veritas, a private equity firm. In 2010, Veritas sold its DynCorp stake to another private equity firm, Cerberus Capital Management, for about $1.5 billion
The constant buying and selling of PMCs by sophisticated private equity partners suggests they are very attractive investments. A lot of money is made by providing security in an insecure world.
One of the concerns, however, is that all of this money is made during periods of insecurity. What happens to these investments if peace breaks out? There is enormous financial incentive to maintain short-term insecurity in perpetuity because peace is bad for business.
The dependence of U.S. strategic objectives on a small group of super-wealthy investors, who are focused on short-term profit maximization has consequences. There is a misalignment of objectives between short-term focused PE-owned-PMCs and U.S. national security, which should include the long view.
What could possibly go wrong by PMCs scouring the Middle East and Africa for short-term profits? Plenty.
|Posted by Jerrald J President on September 17, 2018 at 10:15 AM||comments (0)|
This is what a "REAL GANGSTER" looks like. By JJP
What We Need to Fight the Next Financial Crisis
Congress has taken away some of the tools that were crucial to us during the 2008 panic. It’s time to bring them back.
By Ben S. Bernanke, Timothy F. Geithner and Henry M. Paulson Jr.
Mr. Bernanke is a former chairman of the Federal Reserve. Mr. Geithner and Mr.
Ten years ago, the global economy teetered in the face of a classic financial panic, the most dangerous type of financial crisis. In a financial panic, investors lose confidence in all forms of credit, retreating to the safest and most liquid assets, like Treasury bills. The prices of risky assets collapse, and new credit becomes unavailable, with dire consequences for workers, homeowners and savers.
The seeds of the panic were sown over decades, as the American financial system outgrew the protections against panics that were put in place after the Great Depression. Depression-era safeguards, like deposit insurance, were aimed at ensuring that the banking system remained stable, but by 2007 more than half of all credit flowed outside banks. Financial innovations, like subprime mortgages and automated credit scoring, helped millions to buy homes, but they also facilitated unwise risk-taking by lenders and investors.
Most dangerously, trillions of dollars of risky credit were financed by uninsured, short-term funding. This made the financial system vulnerable to runs — not by ordinary bank depositors, as in the 1930s, but by pension funds, life insurance companies, and other investors. A Balkanized and antiquated regulatory system made identifying these risks difficult and provided policymakers with limited authority to respond when the panic erupted.
The underlying performance of the broader economy before the crisis was troubling as well. Productivity growth was slowing, wages were stagnating, and the share of Americans who were working was shrinking. That put pressure on family incomes even as inequality rose and upward social mobility declined. The desire to maintain relative living standards no doubt contributed to a surge in household borrowing before the crisis.
Henry Paulson, Ben Bernanke and Timothy Geithner worked with regulators and other officials to stabilize the American economy during the 2008 financial crisis.CreditMatthew Cavanaugh/European Pressphoto Agency
Although we and other financial regulators did not foresee the crisis, we moved aggressively to stop it. Acting in its traditional role as lender of last resort, the Federal Reserve provided massive quantities of short-term loans to financial institutions facing runs, while cutting interest rates nearly to zero. The Treasury Department stopped a run on money market funds by providing a backstop for investors. The Treasury also managed the takeover of the mortgage giants Fannie Mae and Freddie Mac, and worked with the Fed to try to prevent the collapse of large, systemically important financial firms. The Federal Deposit Insurance Corporation guaranteed bank debt and protected depositors.
But the powers of the regulators alone proved inadequate. Congressional action made it possible for two presidents, one Republican and one Democratic, working with regulators, to prevent the collapse of the financial system and avoid another Great Depression. Most importantly, Congress provided capital to the banking system, allowing for the normalization of credit flows. Congress also provided support for housing and mortgage markets and authorized a powerful fiscal stimulus. The economy began to grow again in mid-2009, and the funds deployed by Congress were recovered with substantial profit to the taxpayer. Policymakers certainly didn’t get everything right. But compared to most other countries, America’s post-2008 recovery started sooner, was completed faster and was built on healthier foundations.
Are we ready for the next crisis? In some respects, yes. Reforms of financial regulation have helped make the system more resilient, making a crisis less likely to occur. Banks and other key financial institutions are financially stronger, and the gaps in regulatory oversight have largely been closed. Regulators are more attuned to systemwide risks. Our main concern is that these defenses will erode over time and risk-taking will emerge in corners of the financial system that are less constrained by regulation.
the next financial crisis
Even if a financial crisis is now less likely, one will occur eventually. To contain the damage, the Treasury and financial regulators need adequate firefighting tools. After the crisis, Congress gave regulators some promising new authorities to help them manage the failure of an individual financial institution, tools we did not have in the fall of 2008 when we faced the collapse of the investment bank Lehman Brothers. The so-called orderly liquidation authority, for example, which was passed as part of the Dodd-Frank Act in 2010, could help regulators unwind a failing firm in a manner that could be less damaging to the system as a whole.
But in its post-crisis reforms, Congress also took away some of the most powerful tools used by the FDIC, the Fed and the Treasury. Among these changes, the FDIC can no longer issue blanket guarantees of bank debt as it did in the crisis, the Fed’s emergency lending powers have been constrained, and the Treasury would not be able to repeat its guarantee of the money market funds. These powers were critical in stopping the 2008 panic.
From a political perspective, Congress’s decision to limit these crisis-fighting tools was predictable. Many of the actions necessary to stem the crisis, including the provision of loans and capital to financial institutions, were controversial and unpopular. To us, as to the public, the responses often seemed unjust, helping some of the very people and firms who had caused the damage. Those reactions are completely understandable, particularly since the economic pain from the panic was devastating for many.
The paradox of any financial crisis is that the policies necessary to stop it are always politically unpopular. But if that unpopularity delays or prevents a strong response, the costs to the economy become greater. We need to make sure that future generations of financial firefighters have the emergency powers they need to prevent the next fire from becoming a conflagration. We must also resist calls to eliminate safeguards as the memory of the crisis fades. For those working to keep our financial system resilient, the enemy is forgetting.
Ben S. Bernanke, a fellow at the Brookings Institution, was chairman of the Federal Reserve from 2006 to 2014. @BenBernanke
Timothy F. Geithner, president of the private equity firm Warburg Pincus, was Secretary of the Treasury from 2009 to 2013.
Henry M. Paulson Jr., chairman of the Paulson Institute, was Secretary of the Treasury from 2006 to 2009.
|Posted by Jerrald J President on August 28, 2018 at 6:50 PM||comments (0)|
The discretionary budget is $1.203 trillion. More than half goes toward military spending, including the Department of Veterans Affairs and other defense-related departments. To quote the late great 2Pac "They got money for WARS , but can't feed the POOR". By JJP
U.S. Federal Budget Breakdown
The Budget Components and Impact on the US Economy
In Fiscal Year 2019, the federal budget will be $4.407 trillion. The U.S. government estimates it will receive $3.422 trillion in revenue. That creates a $985 billion deficit for October 1, 2018 through September 30, 2019.
Spending is in three categories: Mandatory, which is at $2.739 trillion; Discretionary at $1.305 trillion; and Interest on the National Debt, $363 billion. This article provides a detailed breakdown of each. You can also find links to past budgets at the end.
US Tax Time
Most of the government's revenue comes from you. Photo: David Freund/Getty Images
The federal government will receive $3.422 trillion in revenue. Most of the taxes are paid by you, either through income or payroll taxes:
Income taxes contribute $1.622 trillion or 49 percent of total receipts.
Social Security, Medicare, and other payroll taxes add $1.238 trillion or 36 percent.
Corporate taxes supply $225 billion or 7 percent.
Excise taxes and tariffs contribute $152 billion or 4 percent.
Earnings from the Federal Reserve's holdings add $55 billion or 2 percent. Those are interest payments on the U.S. Treasury debt the Fed acquired through quantitative easing.
Estate taxes and other miscellaneous revenue supply the remaining 2 percent.
It's estimated that each taxpayer works until late April each year to pay for all federal revenue collected. That's Tax Freedom Day. Can you think of any other purchase you make for which you've worked as hard and long?
The government will spend $4.407 trillion. Most of this, about 62 percent of expenditure, pays for mandated benefits such as Social Security, Medicare, and Medicaid.
Interest on the U.S. debt is $363 billion. The U.S. Treasury must pay it to avoid a U.S. debt default. The United States has been fortunate because interest rates have been low. A worldwide flight to safety increased demand for Treasury notes, lowering rates. Now that the global economy is strengthening, Treasury yields are rising. So will interest payments. Interest on the $21 trillion debt is already the fastest growing federal expense.
The remaining 38 percent of the budget pays for everything else. It's called discretionary spending. The U.S. Congress changes this amount each year. It uses the president's budget as a starting point.
Mandatory spending is $2.739 trillion. Social Security is by far the biggest expense at $1.046 trillion. Medicare is next at $625 billion, followed by Medicaid at $412 billion.
Social Security costs are currently covered 100 percent by payroll taxes and interest on past payroll taxes that have been invested. Until 2010, there was more coming into the Social Security Trust Fund than being paid out. Thanks to interest on investments, the Trust Fund is still running a surplus. But, the Trust Fund’s Board estimates that this surplus will be depleted by 2036. Social Security revenue, from payroll taxes and interest earned, will cover only 77 percent of the benefits promised to retirees.
Medicare is already underfunded. Medicare taxes don't pay for all benefits, so this program relies on general tax dollars to pay for a portion of it. Medicaid is 100 percent funded by the general fund
The discretionary budget is $1.203 trillion. More than half goes toward military spending, including the Department of Veterans Affairs and other defense-related departments. The rest must pay for all other domestic programs. The largest are Health and Human Services, Education, and Housing and Urban Development.
There is an emergency fund of $111.4 billion that's not included in the budget process. Most of that, amounting to $88.9 billion, goes to Overseas Contingency Operations to pay for wars.
Military spending was budgeted at $886 billion. The biggest expense is the Department of Defense base budget at $597.1 billion. Overseas Contingency Operations will cost $88.9 billion.
Military spending also includes $181.3 billion for defense-related departments. These include Homeland Security, the State Department, and Veterans Affairs. These departments also receive emergency funding of $18.7 billion. That pays for the war on terror costs triggered by the 9/11 attacks. These include ongoing costs from the war in Iraq and the Afghanistan war.
Congress approved a spending bill of $892.7 billion. It includes $616.9 billion for the DoD base budget, $69 billion for the OCO, and $21.9 billion for the National Nuclear Security Administration within the Department of Energy.
The Capitol building stands behind caution tape
The budget deficit will be $985 billion. That's the difference between $3.422 trillion in revenue and $4.407 trillion in spending. The article on “Deficit by President” shows which U.S. president racked up the highest expenses. A look at the deficit by year will reveal trends in the country’s annual deficits.
How the Deficit Contributes to the National Debt
deficit vs debt
Each year's deficit adds to the debt. Photo: Image Source/Getty Images
Each year, the deficit adds to the U.S. debt. This anticipated tax slows economic growth. It’s like driving a car with the brakes on. It raises interest rates, as investors demand more return. They become hesitant to purchase Treasurys because they fear not being repaid.
Now that the economy has recovered, deficit spending is not necessary. Congress should create a budget surplus to reduce the national debt burden. But it isn’t being done because politicians, who slice popular programs, usually find themselves cut out from the next election.
Congress created the budget process. First, the Executive Office of Management and Budget prepares the budget. The president submits it to Congress on or before the first Monday in February. Congress is supposed to respond with spending appropriation bills that go to the president by June 30. The president has 10 days to reply.
Most important, the deadline for budget approval is September 30. If it isn't approved, the government can shut down, as it did in January 2018 and in 2013. To avoid that, Congress usually passes a continuing resolution. It keeps the government running at spending levels of the last budget. Since the FY 2010 budget, Congress has only followed the budget process twice.
|Posted by Jerrald J President on August 28, 2018 at 6:40 PM||comments (0)|
No; Especially for those who live in America By JJP
The US Carried Out 674 Military Operations in Africa Last Year. Did You Hear About Any of Them?
The US military publicly insists its presence in Africa is negligible. Is that why they call it an American “battlefield” behind closed doors?
For three days, wearing a kaleidoscope of camouflage patterns, they huddled together on a military base in Florida. They came from US Special Operations Command (SOCOM) and US Army Special Operations Command, from France and Norway, from Denmark, Germany, and Canada: 13 nations in all. They came to plan a years-long “Special Operations-centric” military campaign supported by conventional forces, a multinational undertaking that—if carried out—might cost hundreds of millions, maybe billions, of dollars and who knows how many lives.
Ask the men involved and they’ll talk about being mindful of “sensitivities” and “cultural differences,” about the importance of “collaboration and coordination,” about the value of a variety of viewpoints, about “perspectives” and “partnerships.” Nonetheless, behind closed doors and unbeknownst to most of the people in their own countries, let alone the countries fixed in their sights, a coterie of Western special ops planners were sketching out a possible multinational military future for a troubled region of Africa.
From January 13th to 15th, representatives from the United States and 12 partner nations gathered at MacDill Air Force Base in Tampa for an exercise dubbed Silent Quest 15-1. The fictional scenario on which they were to play out their war game had a ripped-from-the-headlines quality to it. It was an amalgam of two perfectly real and ongoing foreign policy and counterterrorism disasters of the post-9/11 era: the growth of Boko Haram in Nigeria and the emergence of the Islamic State, also known as the Islamic State of Iraq and the Levant or ISIL. The war game centered on the imagined rise of a group dubbed the “Islamic State of Africa” and the spread of its proto-caliphate over parts of Nigeria, Niger, and Cameroon—countries terrorized by the real Boko Haram, which did recently pledge its allegiance to the Islamic State.
Silent Quest 15-1 was just the latest in a series of similarly named exercises—the first took place in March 2013—designed to help plot out the special ops interventions of the next decade. This war game was no paintball-style walk in the woods. There were no mock firefights, no dress rehearsals. It wasn’t the flag football equivalent of battle. Instead, it was a tabletop exercise building on something all too real: the ever-expanding panoply of US and allied military activities across ever-larger parts of Africa. Speaking of that continent, Matt Pascual, a participant in Silent Quest and the Africa desk officer for SOCOM’s Euro-Africa Support Group, noted that the United States and its allies were already dealing with “myriad issues” in the region and, perhaps most importantly, that many of the participating countries “are already there.” The country “already there” the most is, of course, Pascual’s own: the United States.
In recent years, the United States has been involved in a variety of multinational interventions in Africa, including one in Libya that involved both a secret war and a conventional campaign of missiles and air strikes, assistance to French forces in the Central African Republic and Mali, and the training and funding of African proxies to do battle against militant groups like Boko Haram as well as Somalia’s al-Shabab and Mali’s Ansar al-Dine. In 2014, the United States carried out 674 military activities across Africa, nearly two missions per day, an almost 300% jump in the number of annual operations, exercises, and military-to-military training activities since US Africa Command (AFRICOM) was established in 2008.
Despite this massive increase in missions and a similar swelling of bases, personnel, and funding, the picture painted last month before the Senate Armed Services Committee by AFRICOM chief General David Rodriguez was startlingly bleak. For all the American efforts across Africa, Rodriguez offered a vision of a continent in crisis, imperiled from East to West by militant groups that have developed, grown in strength, or increased their deadly reach in the face of US counterterrorism efforts.
“Transregional terrorists and criminal networks continue to adapt and expand aggressively,” Rodriguez told committee members. “Al-Shabab has broadened its operations to conduct, or attempt to conduct, asymmetric attacks against Uganda, Ethiopia, Djibouti, and especially Kenya. Libya-based threats are growing rapidly, including an expanding ISIL presence… Boko Haram threatens the ability of the Nigerian government to provide security and basic services in large portions of the northeast.” Despite the grim outcomes since the American military began “pivoting” to Africa after 9/11, the United States recently signed an agreement designed to keep its troops based on the continent until almost midcentury.
For years, the US military has publicly insisted that its efforts in Africa are negligible, intentionally leaving the American people, not to mention most Africans, in the dark about the true size, scale, and scope of its operations there. AFRICOM public affairs personnel and commanders have repeatedly claimed no more than a “light footprint” on the continent. They shrink from talk of camps and outposts, claiming to have just one baseanywhere in Africa: Camp Lemonnier in the tiny nation of Djibouti. They don’t like to talk about military operations. They offer detailed information about only a tiny fraction of their training exercises. They refuse to disclose the locations where personnel have been stationed or even counts of the countries involved.
During an interview, an AFRICOM spokesman once expressed his worry to me that even tabulating how many deployments the command has in Africa would offer a “skewed image” of US efforts. Behind closed doors, however, AFRICOM’s officers speak quite a different language. They have repeatedly asserted that the continent is an American “battlefield” and that—make no bones about it—they are already embroiled in an actual “war.”
According to recently released figures from US Africa Command, the scope of that “war” grew dramatically in 2014. In its “posture statement,” AFRICOM reports that it conducted 68 operations last year, up from 55 the year before. These included operations Juniper Micron and Echo Casemate, missions focused on aiding French and African interventions in Mali and the Central African Republic; Observant Compass, an effort to degrade or destroy what’s left of Joseph Kony’s murderous Lord’s Resistance Army in central Africa; and United Assistance, the deployment of military personnel to combat the Ebola crisis in West Africa.
The number of major joint field exercises US personnel engaged in with African military partners inched up from 10 in 2013 to 11 last year. These included African Lion in Morocco, Western Accord in Senegal, Central Accord in Cameroon, and Southern Accord in Malawi, all of which had a field training component and served as capstone events for the prior year’s military-to-military instruction missions.
AFRICOM also conducted maritime security exercises including Obangame Express in the Gulf of Guinea, Saharan Express in the waters off Senegal, and three weeks of maritime security training scenarios as part of Phoenix Express 2014, with sailors from numerous countries including Algeria, Italy, Libya, Malta, Morocco, Tunisia, and Turkey.
The number of security cooperation activities skyrocketed from 481 in 2013 to 595 last year. Such efforts included military training under a “state partnership program” that teams African military forces with US National Guard units and the State Department-funded Africa Contingency Operations Training and Assistance, or ACOTA, program through which US military advisers and mentors provide equipment and instruction to African troops.
In 2013, the combined total of all US activities on the continent reached 546, an average of more than one mission per day. Last year, that number leapt to 674. In other words, US troops were carrying out almost two operations, exercises, or activities—from drone strikes to counterinsurgency instruction, intelligence gathering to marksmanship training—somewhere in Africa every day. This represents an enormous increase from the 172 “missions, activities, programs, and exercises” that AFRICOM inherited from other geographic commands when it began operations in 2008.
|Posted by Jerrald J President on August 28, 2018 at 6:35 PM||comments (0)|
Meet the new Conquer, same as the old Conquer. By JJP
The U.S. is waging a massive shadow war in Africa, exclusive documents reveal
Six years ago, a deputy commanding general for U.S. Army Special Operations Command gave a conservative estimate of 116 missions being carried out at any one time by Navy SEALs, Army Green Berets, and other special operations forces across the globe.
Today, according to U.S. military documents obtained by VICE News, special operators are carrying out nearly 100 missions at any given time — in Africa alone. It’s the latest sign of the military’s quiet but ever-expanding presence on the continent, one that represents the most dramatic growth in the deployment of America’s elite troops to any region of the globe.
In 2006, just 1 percent of all U.S. commandos deployed overseas were in Africa. In 2010, it was 3 percent. By 2016, that number had jumped to more than 17 percent. In fact, according to data supplied by U.S. Special Operations Command, there are now more special operations personnel devoted to Africa than anywhere except the Middle East — 1,700 people spread out across 20 countries dedicated to assisting the U.S. military’s African partners in their fight against terrorism and extremism.
“At any given time, you will find SOCAFRICA conducting approximately 96 activities in 20 countries,” Donald Bolduc, the U.S. Army general who runs the special operations command in Africa (SOCAFRICA), wrote in an October 2016 strategic planning guidance report. (The report was obtained by VICE News in response to a Freedom of Information Act request and is published in its entirety below.) VICE News reached out to SOCAFRICA and U.S. Africa Command (AFRICOM) for clarification on these numbers; email return receipts show an AFRICOM spokesperson “read” three such requests, but the command did not offer a reply.
“Africa’s challenges could create a threat that surpasses the threat that the U.S. currently faces from conflict in Afghanistan, Iraq, and Syria.”
The October 2016 report offers insight into what the U.S. military’s most elite forces are currently doing in Africa and what they hope to achieve. In so doing, it paints a picture of reality on the ground in Africa today and what it could be 30 years from now.
That picture is bleak.
“Africa’s challenges could create a threat that surpasses the threat that the United States currently faces from conflict in Afghanistan, Iraq, and Syria,” Bolduc warned. He went on to cite a laundry list of challenges with which he and his personnel must contend: ever-expanding illicit networks, terrorist safe havens, attempts to subvert government authority, a steady stream of new recruits and resources.
Bolduc indicated his solution was the “acceleration of SOF [special operations forces] missions [filling] a strategic gap as the military adjusts force structure now and in the future.” Translation: U.S. commandos “in more places, doing more” in Africa going forward.
At the same time, Bolduc says the U.S. is not at war in Africa. But this assertion is challenged by the ongoing operations aimed at the militant group al-Shabaab in Somalia, which operates often in all-but-ungoverned and extraordinarily complex areas Bolduc calls “gray zones.”
In January, for example, U.S. advisers conducting a counterterrorism operation alongside local Somali forces and troops from the African Union Mission in Somalia “observed al-Shabaab fighters threatening their safety and security” and “conducted a self-defense strike to neutralize the threat,” according to a press release from AFRICOM.
A U.S. Army Green Beret patrols with Nigerian soldiers during a training exercise in February. (Photo by Staff Sgt. Kulani Lakanaria)
Earlier this month, in what AFRICOM described as “an advise-and-assist operation alongside Somali National Army forces,” Navy SEAL Kyle Milliken was killed and two other U.S. personnel were injured during a firefight with al-Shabaab militants about 40 miles west of Somalia’s capital, Mogadishu. The battle occurred shortly after President Donald Trump loosened Obama-era restrictions on offensive operations in Somalia, thereby allowing U.S. forces more discretion and leeway in conducting missions and opening up the possibility of more frequent airstrikes and commando raids.
“It allows us to prosecute targets in a more rapid fashion,” Gen. Thomas Waldhauser, the AFRICOM commander, said of the change. In April, the U.S. military reportedly requested the locations of aid groups working in the country, an indication that yet a greater escalation in the war against al-Shabaab may be imminent.
“Looking at counterterrorism operations in Somalia, it’s clear the U.S. has been relying heavily on the remote-control form of warfare so favored by President Obama,” said Jack Serle, who covers the subject for the London-based Bureau of Investigative Journalism.
Recently, the U.S. has augmented this strategy, working alongside local Somali forces and African Union troops under the banner of “train, advise, and assist” missions and other types of “support” operations, according to Serle. “Now they partner with local security forces but don’t engage in actual combat, the Pentagon says. The truth of that is hard to divine.”
U.S. operations in Somalia are part of a larger continent-spanning counterterrorism campaign that saw special operations forces deploy to at least 32 African nations in 2016, according to open source data and information supplied by U.S. Special Operations Command. The cornerstone of this strategy involves training local proxies and allies — “building partner capacity” in the military lexicon.
“Providing training and equipment to our partners helps us improve their ability to organize, sustain, and employ a counter violent extremist force against mutual threats,” the SOCAFRICA report says.
As part of its increasing involvement in the war against Boko Haram militants in the Lake Chad Basin — it spans parts of Nigeria, Niger, Cameroon, and Chad — for example, the U.S. provided $156 million to support regional proxies last year.
In addition to training, U.S. special operators, including members of SEAL Team 6, reportedly assist African allies in carrying out a half dozen or more raids every month. In April, a U.S. special operator reportedly killed a fighter from Joseph Kony’s Lord’s Resistance Army during an operation in the Central African Republic. U.S. forces also remain intimately involved in conflict in Libya after the U.S. ended an air campaign there against the Islamic State group in December. “We’re going to keep a presence on the ground… and we’re going to develop intelligence and take out targets when they arise,” Waldhauser said in March.
“We believe the situation in Africa will get worse without our assistance.”
Though Bolduc said special operators are carrying out about 96 missions on any given day, he didn’t specify how many total missions are being carried out per year. SOCAFRICA officials did not respond to several requests for that number.
The marked increase in U.S. activity tracks with the rising number of major terror groups in Africa. A 2012 version of SOCAFRICA’s strategic planning documents also obtained by VICE News lists five major terror groups. The October 2016 files list seven by name — al-Qaida in the Lands of the Islamic Magreb, ISIS, Ansar al-Sharia, al-Murabitun, Boko Haram, the Lord’s Resistance Army, and al-Shabaab — in addition to “other violent extremist organizations,” also known as VEOs. In 2015, Bolduc said that there are nearly 50 terrorist organizations and “illicit groups” operating on the African continent.
Terror attacks in sub-Saharan Africa have skyrocketed in the past decade. Between 2006 and 2015, the last year covered by data from the National Consortium for the Study of Terrorism and Responses to Terrorism at the University of Maryland, attacks jumped from about 100 per year to close to 2,000. “From 2010 to the present,” Bolduc says in the report, “VEOs in Africa have been some of the most lethal on the planet.”
“Many of Africa’s indicators are trending downward,” he writes. “We believe the situation in Africa will get worse without our assistance.”
Colby Goodman, the director of the Washington, D.C.–based Security Assistance Monitor, pointed to some recent tactical gains against terror groups, but warned that progress might be short-lived and unsustainable. “My continuing concerns about U.S. counterterrorism strategy in Africa,” he said, “is an over-focus on tactical military support to partner countries at the expense of a more whole-government approach and a lack of quality assessments and evaluations of U.S. security aid to these countries.”
|Posted by Jerrald J President on August 28, 2018 at 6:30 PM||comments (0)|
Don't ever forget who the PRESIDENT was when these military operations began! President Obama...The face of White Supremacy does not always have a White face. By JJP
U.S. expands secret intelligence operations in Africa
OUAGADOUGOU, Burkina Faso — The U.S. military is expanding its secret intelligence operations across Africa, establishing a network of small air bases to spy on terrorist hideouts from the fringes of the Sahara to jungle terrain along the equator, according to documents and people involved in the project.
At the heart of the surveillance operations are small, unarmed turboprop aircraft disguised as private planes. Equipped with hidden sensors that can record full-motion video, track infrared heat patterns, and vacuum up radio and cellphone signals, the planes refuel on isolated airstrips favored by African bush pilots, extending their effective flight range by thousands of miles.
About a dozen air bases have been established in Africa since 2007, according to a former senior U.S. commander involved in setting up the network. Most are small operations run out of secluded hangars at African military bases or civilian airports.
The nature and extent of the missions, as well as many of the bases being used, have not been previously reported but are partially documented in public Defense Department contracts. The operations have intensified in recent months, part of a growing shadow war against al-Qaeda affiliates and other militant groups. The surveillance is overseen by U.S. Special Operations forces but relies heavily on private military contractors and support from African troops.
The surveillance underscores how Special Operations forces, which have played an outsize role in the Obama administration’s national security strategy, are working clandestinely all over the globe, not just in war zones. The lightly equipped commando units train foreign security forces and perform aid missions, but they also include teams dedicated to tracking and killing terrorism suspects.
The establishment of the Africa missions also highlights the ways in which Special Operations forces are blurring the lines that govern the secret world of intelligence, moving aggressively into spheres once reserved for the CIA. The CIA has expanded its counterterrorism and intelligence-gathering operations in Africa, but its manpower and resources pale in comparison with those of the military.
U.S. officials said the African surveillance operations are necessary to track terrorist groups that have taken root in failed states on the continent and threaten to destabilize neighboring countries.
A hub for secret network
A key hub of the U.S. spying network can be found in Ouagadougou (WAH-gah-DOO-goo), the flat, sunbaked capital of Burkina Faso, one of the most impoverished countries in Africa.
Under a classified surveillance program code-named Creek Sand, dozens of U.S. personnel and contractors have come to Ouagadougou in recent years to establish a small air base on the military side of the international airport.
The unarmed U.S. spy planes fly hundreds of miles north to Mali, Mauritania and the Sahara, where they search for fighters from al-Qaeda in the Islamic Maghreb, a regional network that kidnaps Westerners for ransom.
The surveillance flights have taken on added importance in the turbulent aftermath of a March coup in Mali, which has enabled al-Qaeda sympathizers to declare an independent Islamist state in the northern half of the country.
Elsewhere, commanders have said they are increasingly worried about the spread of Boko Haram, an Islamist group in Nigeria blamed for a rash of bombings there. U.S. forces are orchestrating a regional intervention in Somalia to target al-Shabab, another al-Qaeda affiliate. In Central Africa, about 100 American Special Operations troops are helping to coordinate the hunt for Joseph Kony, the Ugandan leader of a brutal guerrilla group known as the Lord’s Resistance Army.
The results of the American surveillance missions are shrouded in secrecy. Although the U.S. military has launched airstrikes and raids in Somalia, commanders said that in other places, they generally limit their involvement to sharing intelligence with allied African forces so they can attack terrorist camps on their own territory.
The creeping U.S. military involvement in long-simmering African conflicts, however, carries risks. Some State Department officials have expressed reservations about the militarization of U.S. foreign policy on the continent. They have argued that most terrorist cells in Africa are pursuing local aims, not global ones, and do not present a direct threat to the United States.
The potential for creating a popular backlash can be seen across the Red Sea, where an escalating campaign of U.S. drone strikes in Yemen is angering tribesmen and generating sympathy for an al-Qaeda franchise there.
In a response to written questions from The Washington Post, the U.S. Africa Command said that it would not comment on “specific operational details.”
“We do, however, work closely with our African partners to facilitate access, when required, to conduct missions or operations that support and further our mutual security goals,” the command said.
Surveillance and intelligence-gathering operations, it added, are “simply a tool we employ to enable host nation militaries to better understand the threat picture.”
Uncovering the details
The U.S. military has largely kept details of its spy flights in Africa secret. The Post pieced together descriptions of the surveillance network by examining references to it in unclassified military reports, U.S. government contracting documents and diplomatic cables released by WikiLeaks, the anti-secrecy group.
Further details were provided by interviews with American and African officials, as well as military contractors.
In addition to Burkina Faso, U.S. surveillance planes have operated periodically out of nearby Mauritania. In Central Africa, the main hub is in Uganda, though there are plans to open a base in South Sudan. In East Africa, U.S. aircraft fly out of bases in Ethiopia, Djibouti, Kenya and the Indian Ocean archipelago of the Seychelles.
Army Gen. Carter F. Ham, the head of U.S. Africa Command, which is responsible for military operations on the continent, hinted at the importance and extent of the air bases while testifying before Congress in March. Without divulging locations, he made clear that, in Africa, he wanted to expand “ISR,” the military’s acronym for intelligence, surveillance and reconnaissance.
“Without operating locations on the continent, ISR capabilities would be curtailed, potentially endangering U.S. security,” Ham said in a statement submitted to the House Armed Services Committee. “Given the vast geographic space and diversity in threats, the command requires increased ISR assets to adequately address the security challenges on the continent.”
Some of the U.S. air bases, including ones in Djibouti, Ethiopia and the Seychelles, fly Predator and Reaper drones, the original and upgraded models, respectively, of the remotely piloted aircraft that the Obama administration has used to kill al-Qaeda leaders in Pakistan and Yemen.
“We don’t have remotely piloted aircraft in many places other than East Africa, but we could,” said a senior U.S. military official, who spoke on the condition of anonymity to discuss intelligence matters. “If there was a need to do so and those assets were available, I’m certain we could get the access and the overflight [permission] that is necessary to do that.”
Most of the spy flights in Africa, however, take off the old-fashioned way — with pilots in the cockpit. The conventional aircraft hold two big advantages over drones: They are cheaper to operate and far less likely to draw attention because they are so similar to the planes used throughout Africa.
The bulk of the U.S. surveillance fleet is composed of single-engine Pilatus PC-12s, small passenger and cargo utility planes manufactured in Switzerland. The aircraft are not equipped with weapons. They often do not bear military markings or government insignia.
The Pentagon began acquiring the planes in 2005 to fly commandos into territory where the military wanted to maintain a clandestine presence. The Air Force variant of the aircraft is known as the U-28A. The Air Force Special Operations Command has about 21 of the planes in its inventory.
In February, a U-28A crashed as it was returning to Camp Lemonnier in Djibouti, the only permanent U.S. military base in Africa. Four airmen from the Air Force Special Operations Command were killed. It was the first reported fatal incident involving a U-28A since the military began deploying the aircraft six years ago.
Air Force officials said that the crash was an accident and that they are investigating the cause. Military officials declined to answer questions about the flight’s mission.
Because of its strategic location on the Horn of Africa, Camp Lemonnier is a hub for spy flights in the region. It is about 500 miles from southern Somalia, an area largely controlled by the al-Shabab militia. Lemonnier is even closer — less than 100 miles — to Yemen, where another al-Qaeda franchise has expanded its influence and plotted attacks against the United States.
Elsewhere in Africa, the U.S. military is relying on private contractors to provide and operate PC-12 spy planes in the search for Kony, the fugitive leader of the Lord’s Resistance Army, a group known for mutilating victims, committing mass rape and enslaving children as soldiers.
Ham, the Africa Command chief, said in his testimony to Congress in March that he was seeking to establish a base for surveillance flights in Nzara, South Sudan. Although that would bolster the hunt for Kony, who is wanted by the International Criminal Court, it would also enable the U.S. military to keep an eye on the worsening conflict between Sudan and South Sudan. The two countries fought a civil war for more than two decades and are on the verge of war again, in part over potentially rich oil deposits valued by foreign investors.
Other aviation projects are in the offing. An engineering battalion of Navy Seabees has been assigned to complete a $10 million runway upgrade this summer at the Manda Bay Naval Base, a Kenyan military installation on the Indian Ocean. An Africa Command spokeswoman said the runway extension is necessary so American C-130 troop transport flights can land at night and during bad weather.
About 120 U.S. military personnel and contractors are stationed at Manda Bay, which Navy SEALs and other commandos have used as a base from which to conduct raids against Somali pirates and al-Shabab fighters.
About 6,000 miles to the west, the Pentagon is spending $8.1 million to upgrade a forward operating base and airstrip in Mauritania, on the western edge of the Sahara. The base is near the border with strife-torn Mali.
The Defense Department also set aside $22.6 million in July to buy a Pilatus PC-6 aircraft and another turboprop plane so U.S.-trained Mauritanian security forces can conduct rudimentary surveillance operations, according to documents submitted to Congress.
Crowding the embassy
The U.S. military began building its presence in Burkina Faso in 2007, when it signed a deal that enabled the Pentagon to establish a Joint Special Operations Air Detachment in Ouagadougou. At the time, the U.S. military said the arrangement would support “medical evacuation and logistics requirements” but provided no other details.
By the end of 2009, about 65 U.S. military personnel and contractors were working in Burkina Faso, more than in all but three other African countries, according to a U.S. Embassy cable from Ouagadougou. In the cable, diplomats complained to the State Department that the onslaught of U.S. troops and support staff had “completely overwhelmed” the embassy.
In addition to Pilatus PC-12 flights for Creek Sand, the U.S. military personnel in Ouagadougou ran a regional intelligence “fusion cell” code-named Aztec Archer, according to the cable.
Burkina Faso, a predominantly Muslim country whose name means “the land of upright men,” does not have a history of radicalism. U.S. military officials saw it as an attractive base because of its strategic location bordering the Sahel, the arid region south of the Sahara where al-Qaeda’s North African affiliate is active.
Unlike many other governments in the region, the one in Burkina Faso was relatively stable. The U.S. military operated Creek Sand spy flights from Nouakchott, Mauritania, until 2008, when a military coup forced Washington to suspend relations and end the surveillance, according to former U.S. officials and diplomatic cables.
In Ouagadougou, both sides have worked hard to keep the partnership quiet. In a July 2009 meeting, Yero Boly, the defense minister of Burkina Faso, told a U.S. Embassy official that he was pleased with the results. But he confessed he was nervous that the unmarked American planes might draw “undue attention” at the airport in the heart of the capital and suggested that they move to a more secluded hangar.
“According to Boly, the present location of the aircraft was in retrospect not an ideal choice in that it put the U.S. aircraft in a section of the airfield that already had too much traffic,” according to a diplomatic cable summarizing the meeting. “He also commented that U.S. personnel were extremely discreet.”
U.S. officials raised the possibility of basing the planes about 220 miles to the west, in the city of Bobo Dioulasso, according to the cable. Boly said that the Americans could use that airport on a “short term or emergency basis” but that a U.S. presence there “would likely draw greater attention.”
In an interview with The Post, Djibril Bassole, the foreign minister of Burkina Faso, praised security relations between his country and the United States, saying they were crucial to containing al-Qaeda forces in the region.
“We need to fight and protect our borders,” he said. “Once they infiltrate your country, it’s very, very difficult to get them out.”
Bassole declined, however, to answer questions about the activities of U.S. Special Operations forces in his country.
“I cannot provide details, but it has been very, very helpful,” he said. “This cooperation should be very, very discreet. We should not show to al-Qaeda that we are now working with the Americans.”
Discretion is not always strictly observed. In interviews last month, residents of Ouagadougou said American service members and contractors stand out, even in plainclothes, and are appreciated for the steady business they bring to bars and a pizzeria in the city center.
In April 2010, one American, in particular, drew attention. A U.S. contractor who had been assigned to support the surveillance missions in Ouagadougou was flying home from Africa on leave when he announced that he had been “in Ouaga illegally” and was carrying dynamite in his boots and laptop.
As the contractor, Derek Stansberry, mumbled other incoherent stories about allegedly top-secret operations, he was grabbed by U.S. air marshals aboard the
Paris-to-Atlanta flight. No explosives were found, but the incident drew international attention.
Stansberry, who did not respond to a request for comment, was found not guilty by reason of temporary insanity; he said he was overstressed and had overdosed on the sleep aid Ambien.
A photograph on his Facebook page around the time of the incident showed him posing in the cockpit of a Pilatus aircraft. The caption read: “Flying a PC-12 ain’t that hard.”
|Posted by Jerrald J President on August 28, 2018 at 6:25 PM||comments (0)|
Yet not one individual went to jail. By JJP
The Financial Crisis Cost Every American $70,000, Fed Study Says
America never made up the growth it lost in the 2008 global financial crisis and the recession it triggered. A decade later, U.S. households are still counting the cost.
Gross domestic product remains well below what its 2007 trend would have implied and it’s unlikely the economy will ever make up that lost ground, according to research from the Federal Reserve Bank of San Francisco published Monday. The hit will cost the average American $70,000 in lifetime income, they estimate.
“Without the large adverse financial shocks experienced in 2007 and 2008, the behavior of GDP would have been very different,” Regis Barnichon and his co-authors write. They find that the hit to growth was persistently 7 percentage points deeper than it would have been in the mild recession that they think would have occurred without the financial meltdown. “This is a large number.”
They arrive at the lifetime income loss by taking per-capita GDP in 2007 and discounting at an annual 5 percent rate to calculate its present value.