Labor

The US Economy Has Not Recovered And Will Not Recover

Paul Craig Roberts

The US economy died when middle class jobs were offshored and when the financial system was deregulated.

Jobs offshoring benefitted corporate executives and shareholders, because lower labor and compliance costs resulted in higher profits. These profits flowed through to shareholders in the form of capital gains and to executives in the form of “performance bonuses.” Wall Street benefitted from the bull market generated by higher profits.

If you were looking for signs that US trade may be collapsing on itself, a good place to start would be Class 8 truck orders which, as we first documented in early December, have posted sharp y/y declines of late.

In November for instance, orders collapsed 59% y/y. In December, the drop was 37%, and in January, Class 8 orders dove 48% from the year ago period.

Submitted by Simon Black via SovereignMan.com,

According to financial research firm ICI, total retirement assets in the Land of the Free now exceed $23 trillion.

$7.3 trillion of that is held in Individual Retirement Accounts (IRAs).

That’s an appetizing figure, especially for a government that just passed $19 trillion in debt and is in pressing need of new funding sources.

Submitted by Leonard Brecken via OilPrice.com,

During the 1990s, developing nations including Mexico and many in Asia became very competitive manufacturing bases due to lower wage structures. This, I believe, was the root cause of the use of failed fiscal and monetary policy to “close the gap” with the competitiveness of low-cost wage structures around the world, which has played out for three decades. The result has been three bubbles and a worsening systemic problem of wage and taxation disparity between the U.S. and developing nations.

A leaflet offering cleaning services with different wages according to the ethnicity of workers, has sparked criticism and charges of racism after it was discovered in Tel Aviv, Israel over the weekend.  The leaflet purports to help people who are looking for a legally documented cleaner, but who doesn’t wish to hire an Arab “for security reasons”. Timesofisrael.com reports: According to the ad, a cleaner of African origin costs NIS 49 ($12.69) an hour, while one of Eastern European origin is priced at an hourly rate of NIS 52 ($13.39).