Robert Pollin, UMass Amherst economics professor and co-director of the Political Economy Research Institute (PERI), and Bill Fletcher, executive editor of The Black Commentator, analyze President Obama’s State of the Union address in a a recent interview on The Real News Network.
Pollin, a consultant to the Department of Energy, was pleased with the emphasis that President Obama put on research, information technology, and especially clean energy technology. While he wasn’t completely specific on how these investments would be funded, the President did mention eliminating “the billions in taxpayer dollars we currently give to oil companies.”
Both Pollin and Fletcher agree, however, that the President’s speech was vague on many points and also too optimistic with regard to the economy. In particular, they are both concerned with the extreme measures that states are considering due to severe budget shortfalls. The measures, which include declaring bankruptcy and breaking pension fund obligations, were not mentioned in the State of the Union.
Richard Wolff, UMass Amherst economics professor emeritus, writes about the growing divide between the wealthiest 10% of U.S. citizens and the rest of the country. He cites Goldman Sachs’ bonus structure as an analogy to this larger problem. Out of the $15 billion that Goldman pays out in bonuses, those at the top will each receive millions in bonuses (and much more in stock options) leaving less and less to trickledown the hierarchy. And while big banks are distributing bonuses, states like California are forced to make extreme cuts to their budgets including higher education and Medicare. According to Wolff, “US capitalism continues to dole out wealth for a few and austerity for the masses.”
The new governor of California announced last week that he proposed to cut about $1.5bn from the largest and arguably the best state system of higher education in the country. Such a cut will further damage the quantity and quality of the skilled and hi-tech workforce on which the nation’s economic future depends. Governor Brown also proposed over $1bn in cuts to the Medicare program providing healthcare to hundreds of thousands of California’s poorest residents.
Meanwhile, Goldman Sachs pays out $15bn, alongside the other big banks’ comparable payouts. More than yet another glaring contribution to social division, these contrasts represent stages on the path to self-destructive social implosion.
In her weekly New York Times Economix blog post, Nancy Folbre, UMass Amherst economics professor, looks at what the potential economic impact of legalizing polygamy would be. Supporters of polygamy argue that it could be economically advantageous to society by increasing demand for women and creating a more efficient marriage market. Critics, however, point out that policies and practices strongly associated with polygyny (one husband, more than one wife) can lead to negative consequences for women, both in society and as individuals. According to Folbre, while no one fully understands the complex social dynamics, the “historical links among polygyny, patriarchy and inequality seem very strong. And monogamy — whether heterosexual or homosexual — probably has some equalizing effects for both families and communities.” (New York Times, 1/24/11)
M.V. Lee Badgett, economics professor and director of the Center for Public Policy and Administration, weighs in on the debate about same-sex marriage in an online debate on the issue in The Economist magazine. Badgett says, based on her research, that same-sex couples share the basic human right to marry. She concludes, “Overall, the evidence suggests that letting same-sex couples marry would be a good thing for all concerned, straight or gay. Expanding access to the institution creates these gains; no change in the rules and expectations for married couples is required or sought. Gay couples’ interest in marriage is a vote in favour of the continuing relevance of marriage in today’s world, a change that should strengthen, not weaken, the institution.” (The Economist, 1/6/11)
When the annual meeting of the American Economic Association, the world’s largest professional society for economists, convened Jan. 6 in Denver, the first day included a debate on the role of ethics in the profession. The move is in response to criticism of many economists who comment in the media or give professional testimony about economic issues without disclosing their personal and financial ties to the industries they are discussing. Epstein and graduate student Jessica Carrick-Hagenbarth recently published a paper that found many of the financial economists who weighed in on new federal regulation of Wall Street didn’t disclose their potential conflicts of interest. (The Economist, 1/6/11)