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Showing posts from March 24, 2014

What’s the Primary Cause of Wealth Inequality? Financialization

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[Thomas Piketty was just interviewed on Moyers & Company about his book Capital in the 21st Century*RON*]
By Charles Hugh Smith, Global Research, March 24, 2014


Financialization results when leverage and information asymmetry replace innovation and productive investment as the source of wealth creation.

Emmanuel Saez and Thomas Piketty are leading lights in the exploration of rising wealth inequality. Both are academic economists who have devoted considerable time and effort to assembling data that deepens our understanding of the issues.

For example, Saez’s recent essay Striking it Richer: The Evolution of Top Incomes in the United States, provides an in-depth look at the widening gulf between the top 1% and the bottom 90% from 2009 to 2012.

Here is a chart of the top 10% share of income, based on their research: (the note in red marking the beginning of financialization in 1982 is my own)

Canadian grizzly bears face expanded hunt

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[I suppose Liberal leader Christy Clark can use all those pelts to mop up the oil spills. *RON*]

Researchers protest that British Columbia's hunting quotas are not based on science.
Nicola Jones, Nature, 21 March 2014

Data on grizzly bears in British Columbia are not reliable enough to justify higher hunting quotas, researchers argue.

As the Canadian province of British Columbia prepares to open its annual grizzly-bear hunting season, conservation scientists are protesting the provincial government’s decision to expand the number of animals that can be killed.

British Columbia officials estimate that there are 15,000 grizzlies (Ursos arctos horribilis) in the province, making up roughly one-quarter of the North American population. Although some sub-populations are declining and the species is listed as of “special concern” by some environmental bodies, it is not listed under Canada’s Species at Risk Act, which would afford the bears governme…

French Wages Are Not The Problem

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[On misleading claims of overly-high labour costs in Europe. Germany's labour costs have actually deflated at times; other nations match well with inflation targets. *RON*]
Paul Krugman, Conscience of a Liberal, NY Times, March 24, 2014.

In yesterday’s Times, Steven Rattner grudgingly admits that expansionary monetary policy in Europe may be a good thing, but bemoans the lack of adjustment, and gives us this chart:


So France, like Italy though not quite to the same extent, has a problem of unsustainable growth in labor costs. Right?

No, no, no.

Research Shows Some Test Methods Miss 99 Percent of Radium in Fracking Waste

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[A current method, approved by the EPA and state regulators in the Marcellus Shale region, underestimates radium levels in fracking water by 95%. In addition, the oil industry has "been caught 95 times trying to illegally dump radioactive waste in North Dakota between last January and this February, according to an Associated Press review. The total fines actually issued when these people were caught: zero dollars. They were simply told to promise to dispose of it properly." *RON*]
 SHARON KELLY, March 24, 2014, DeSmogBlog

Every year, fracking generates hundreds of billions of gallons of wastewater laced with corrosive salts, radioactive materials and many other chemicals. Because some of that wastewater winds up in rivers after it’s treated to remove dangerous contaminants, regulators across the U.S. have begun to develop testing regimens to gauge how badly fracking wastewater is polluted and how effective treatment plants are at removing …

These Charts Show What is Wrong With American Capitalism

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[Corporations have taken profits generated by low taxes and deregulation and used it to buy back their shares (artificially boosting stock values) and to give CEOs huge pay raises, rather than investing in jobs or growth. *RON*]
Posted on March 24, 2014 by Yves Smith on NakedCapitalism.com

For the last 30 years, neoliberals have fixated on a simple program: “Get government out of the way,” which meant reduce taxes and regulations. Business will invest more, which will produce a higher growth rate and greater prosperity for all. The belief was that unfettered capitalism could solve all ills.

Policymakers have dutifully followed this script. Corporations have gotten more and more tax breaks, with the result that the GAO found that their effective Federal tax rate in 2010 was 13% of worldwide income for companies with profits. Corporate income taxes represent a mere 11% of total Federal tax receipts, down from 30% in the mid-1950s. And we’ve also seen s…