The "Recovery" Mirage: It Still Comes Down To Wages

[marmar]

from the Working Life blog:




The "Recovery" Mirage: It Still Comes Down To Wages

by Jonathan Tasini
Tuesday 31 of May, 2011


Over the next 18 months, brace yourself for a lot of hand-wringing about the economic crisis we're in. Every so often, we're going to be told the "recovery" is just around the corner. Oh, let's be clear: the worries will have NOTHING to do with what is actually happening to PEOPLE. It will have a lot to do with politics--trying to manage how voters think the economy is doing, rather than actually trying to heal an economy that simply isn't working for most people.

And the managers of the perception game are in deep trouble because they don't seem to get the basic problem: this is all about wages.

The "recovery" continues to be a mirage--even the business traditional press is nervous:

The world's largest economy may be facing a growth problem.

After a disappointing first quarter, economists largely predicted the U.S. recovery would ramp back up as short-term disruptions such as higher gas prices, bad weather and supply problems in Japan subsided.

But there's little indication that's happening. Manufacturing is cooling, the housing market is struggling and consumers are keeping a close eye on spending, meaning the U.S. economy might be on a slower path to full health than expected.

"It's very hard to generate a rapid recovery when rapid recoveries are historically driven by housing and the consumer," said Nigel Gault, an economist at IHS Global Insight. He expects an annualized, inflation-adjusted growth rate of less than 3% in coming quarters—better than the first-quarter's 1.8% rate, but too slow to make a meaningful dent in unemployment.

This piece reveals a lot mainly because it highlights the two things you need to keep asking yourself when you hear the mumbo-jumbo from the two main political parties about the "recovery". ..............(more)

The complete piece is at: http://www.workinglife.org/blogs/view_post.php?content_id=15193

[Vanje]

1. "around the corner"? I hear the reccession is OVER!

I've read it right here at DU. I've even heard it repeated on NPR.

[DCBob]

2. Until housing stabilizes we wont have a strong recovery..

And who knows when housing will recover. The real estate market took a massive blow and coming back from that wont be easy. In fact I doubt we will ever see housing prices like they were in the peak of idiot Bush era. Those were bogus valuations anyway so no one should expect it to ever come back to that level. If it does its likely to just be another bogus bubble.

[Vincardog]

3. The 'recovery' is smoke and mirrors put together by ENRON accounting and lies until wages improve

INCOMES

[sendero]

4. Let me repeat what I have been saying since 2008...

... THERE IS NO RECOVERY.

Don't be fooled by the phony GDP numbers or the phony unemployment numbers.

There is no recovery nor is there any reason for there to BE a recovery. And there won't be for years, and that is the BEST CASE.

And finally, to add a bit of sweetener, we are probably heading for something that will make 2008 look like a picnic within 2 years.

The Government isn't going to do anything to help you, the Media isn't either. You are on your own and the sooner you accept that the better!

[TheKentuckian]

5. and on your own won't come cheap or easy either. You can't run a mass extraction

and have any serious number of the "small people" opting out and being on their own.

Reverse incentives, lots of red tape, zoning restrictions, market manipulation, pollution, resource monopolies, and outright bans are probably coming up on renewable energy, fresh and grey water, and even gardening, much less owning and maintaining property to do such things on.

"On your own" is for yer "betters" nowadays, despite aspiring to much more than that a little while ago "on your own" has become a bridge too far for common folks.
Serfs toil for their daily bread from the company store and do a lot of "shared sacrifice" to make sure the wealthy add to their hordes.

[sendero]

7. "On your own"..

... is my way of saying to prepare and stop believing that this mess will be over soon. It will not.

You, everyone, will have to find a way to survive in the new normal. Because right now is probably about as good as the new normal gets.

[Newest Reality]

6. I would add to that

that there may never be a recovery as we conceive of it.

My opinion is that we will deal with plenty of perception management, (which is what corporate media exists for) in order to continue to manufacture consent in a way that keeps the current system dominant and in control.

There are many factors that lead me to consider that, this being a unique time, we will not be going back to the kind of "growth" and consumption of the past; at least, most of us won't here in the US. We are at the peak of many resources and energy costs, (and availability) are a dominant issue when it comes to the concept of endless, increasing consumerism. It is quite possible that the huge redistribution of wealth is just as much about who has access to resources as it is power and affluence.

While it remains to be seen how this bifurcation of the wealthy and the new, burgeoning, (and potentially permanent) Underclass will pan out, the coming ten or twenty years will be nothing like the previous decades.

If the perception is managed well enough, and people continue to envy and want what the deadbeat rich have, (rather than revolt and throw-off neo-Serfdom under the New Lords) then this process will be gradual enough to be successful without much in the way of meaningful resistance or massive retaliation against the way the system is now custom-rigged to serve and support a small segment of the population that owns, or will come to own, just about everything.

[sendero]

8. I agree..

.. with you completely.

[Johonny]

9. the economy has recovered

look at how high end market good are doing great. The economic system is set up so that the money flows into the top and stays there. The money never trickles down fast enough to drive the middle class and poor economy. The Bush era economy is still going strong. Thus wages are still terrible and job growth slow. The only difference is there is no longer any magic housing money to drive middle class spending. Until the economic flow of money is changes by changing the tax laws and what the government invests in, there is going to be no rebound for the middle class. Its really hard to get excited about an economy that has so different an out come between the classes. Nor is such an economy likely to satisfy enough voters.