Tuesday, December 01, 2009

Class Wars, followed by Return of the Robber Barons. Will the Serfs Strike Back?

First, I found a site that has interesting data broken out by state for unemployment and related issues. They've been following weekly jobless claims, both the "official" estimates and the real figures - and also following layoff announcements from corporations and municipalities across the nation. The news has not been good. As unemployment and underemployment (official and unofficial) continues to climb, the income gap in the US continues to grow by leaps and bounds.

The Layoff List Online
Real Unemployment in the US is now 22%

...When including marginally attached workers and those forced to work part-time instead of full-time we have a national unemployment rate of 17.5%, which is nearly 70% higher than the U3 rate of 10.2%. That’s a dramatic increase from the normally quoted U3 unemployment rate, but even U6 fails to provide the actual percentage of people who are, or may be considered unemployed...

...The BLS now offers the U6 measure of unemployment for states. An example is New York’s U6 rate averages 13.4% for the period fourth quarter of 2008 through third quarter of 2009 at: Alternative measures of labor underutilization by state. So making the simple assumption that the SGS Alternate data is, on a national level, about 4.5% higher than U6, the unemployment rate in New York is closer to 17.9%, and that’s being conservative since the current unemployment rate is higher than the average presented at the BLS. Below is the latest unemployment measurements by state from the BLS:

...When nearly 1 in 5 eligible New York workers are either unemployed or underemployed, we are made aware of the brutal state of employment. Maybe it’s time to spend more money on job creation, instead of pumping billions of dollars into the coffers of banking bonus babies and corrupt banks and institutions that were made too big to fail by two presidential administrations more concerned about campaign money than taxpayer needs.

A sliver of good news, according to John Williams, is that during the Great Depression the SGS Alternate measure of unemployment would likely be near 34%. Let’s hope our elected “representatives” don’t aim for those lofty unemployment levels...

“When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it.” – Frederic Bastiat (1801-1850)

Hence the "bailout" which was nothing more than a massive transfer of wealth from taxpayers to fat cat ceo's like those at AIG. Any business "too big to fail" should be subject to AntiTrust legislation and broken up into smaller pieces that aren't "too big to fail," and then be allowed to fail. Instead we have multi-billionaires with platinum parachutes while the little guy who worked on the line gets a pink slip. That's not capitalism - that's stealing from taxpayers to give to rich cronies. That's corruption, not the proper operation of our government. And what did AIG do with their bailout money? Found a way to screw unemployed people even further, that's what.

The Exiled Online: Class War For Idiots
November 26, 2009
Bailed-Out AIG Goons Force Poor to Choose Between Running Water and Food
By Yasha Levine

What are we getting in return for the bailout? So far, predatory credit card rates, exorbitant bank fees and obscene Wall Street bonuses. But we’re being robbed in other, sneakier ways, too. It seems that taxpayers in the poorest, most vulnerable parts of the county are getting plundered by the same institutions they bailed out. One example is AIG’s underhanded fleecing of residents of rural Kentucky.

Middlesboro and Clinton are two tiny, impoverished towns in southern Kentucky with a combined population of 12,000. In 2008, Middlesboro’s per capita income was $13,189 a year, only a few hundred dollars more than the average worker earned in third-world Mexico. That is if they were lucky to even get a job. Real unemployment hovers somewhere around 30%, and the state is so broke that half the people eligible for unemployment benefits can’t receive them. Life may be tough and most people live in poverty, but that doesn’t mean they can’t be made a little poorer. That’s the lesson locals learned after bailed-out insurance villain AIG took over their water utility and instantly raised rates to squeeze an extra $1 million in profits out of its new customers, forcing some to consider choosing between running water and food...

...AIG had reason to be pleased with its purchase. Water utilities are one hell of a profitable business, with international corporations easily making a 20 to 30% profit margin, according to a 2007 report by Food and Water Watch. In the US, federal regulations limit profits to 10%, a pesky rule that companies easily subvert by shuffling their income around and “investing” it in side businesses. These kinds of returns would be the envy of the pharmaceutical and oil industries. How do water companies do it? According to Food and Water Watch, they charge 50% more for services than public utilities and pocket the difference...

...Residents had been getting their water bills like clockwork for as long as anyone could remember, but confusion and disorder set in as soon as Utilities rolled out its new and improved billing system. Monthly statements started coming late or didn’t come in for months at a time. People were double-billed and double-penalized for bills that never arrived. One month, a bill would include sewer fees, the next month it wouldn’t—and you’d be charged if didn’t catch the omission. It’s obvious the new invoice system was designed for pure harassment, creating chaos and reaping the rewards of the late fees it generated...

...To make it harder for Clinton residents to file complaints, AIG closed the utility’s local office as soon as it took over the company. Pleas made by phone were rejected...

...In November 2008, right as AIG was recieving the second installment of its bailout and the economy was in a free-fall, AIG’s water utility notified Middlesbro and Clinton residents that it would be raising rates by 51%. It would mean more than $750,000 in additional revenue a year, just from 8,000 customers. The money wouldn’t be used to fund infrastructure improvements—none had been made and none were planned. No, according to a company spokesman, the utility was trying to recoup money it had invested in its “improved” billing system, in effect forcing the victims of the billing system to pay for their own fleecing...

...AIG’s takeover shows again that the American people were screwed by the bailed-out billionaires, who, instead of showing gratitude or willingness to reciprocate, have been preying upon the most vulnerable Americans like they are 15th century barons soaking the peasants.

And as our cities and states start leasing out and selling public infrastructure to pay off their municipal debts, we can expect banks to gain more control of public wealth. Middlesbro and Clinton are a glimpse into the future of post-privatized America.

Readers of this blog knew this was coming, and shouldn't be surprised. This is just one of the many ongoing installments of Class Wars. Coming soon to a municipality near you - Return of the Robber Barons. Until the US joins First World nations in recognizing utilities as a basic human right (along with health care) and not an opportunity to gouge the poor, US citizens will continue on the road to serfdom laid out by the fat cat CEOs. Without relocalization and self-sufficiency, our communities are helpless to withstand the highway robbery.

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