The Financial Meltdown: Government And Big Business

    Yes, we all know by now that big business has pretty much bought our system of government and that the United States government will take care of big business well before taking care of its own average citizens.

The Atlantic

One thing you learn rather quickly when working at the International Monetary Fund is that no one is ever very happy to see you. Typically, your “clients” come in only after private capital has abandoned them, after regional trading-bloc partners have been unable to throw a strong enough lifeline, after last-ditch attempts to borrow from powerful friends like China or the European Union have fallen through. You’re never at the top of anyone’s dance card.

  The author of the article compares other countries who have had similar problems like those that the United States is going through, and shows us what exactly brought the financial crisis’s on in said countries. Bad banking practices was one reason for the economic collapses in Russia and a few others.

In its depth and suddenness, the U.S. economic and financial crisis is shockingly reminiscent of moments we have recently seen in emerging markets (and only in emerging markets): South Korea (1997), Malaysia (1998), Russia and Argentina (time and again). In each of those cases, global investors, afraid that the country or its financial sector wouldn’t be able to pay off mountainous debt, suddenly stopped lending. And in each case, that fear became self-fulfilling, as banks that couldn’t roll over their debt did, in fact, become unable to pay. This is precisely what drove Lehman Brothers into bankruptcy on September 15, causing all sources of funding to the U.S. financial sector to dry up overnight. Just as in emerging-market crises, the weakness in the banking system has quickly rippled out into the rest of the economy, causing a severe economic contraction and hardship for millions of people.

But there’s a deeper and more disturbing similarity: elite business interests—financiers, in the case of the U.S.—played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed, and fast, to pull the economy out of its nosedive. The government seems helpless, or unwilling, to act against them.

  A very interesting read and I suggest that you check out the remainder of the piece here. We are in  for a world of hurt!

Technorati Tags: IMF,Financial Crisis,Government,Politics,Economy

Labor Laws Not Being Enforced

  Just in case you do not read the NYTimes, an article from the paper says that the Labor Department’s Wage and Hour Division is not doing its job as it is supposed to do. The agency is not enforcing the minimum wage laws as well as overtime laws and a few others. Like we should really be surprised at this?

   A few examples of non-action after complaints were filled by under-cover workers:

In one case, the division failed to investigate a complaint that under-age children in Modesto, Calif., were working during school hours at a meatpacking plant with dangerous machinery, the G.A.O., the nonpartisan auditing arm of Congress, found.

When an undercover agent posing as a dishwasher called four times to complain about not being paid overtime for 19 weeks, the division’s office in Miami failed to return his calls for four months, and when it did, the report said, an official told him it would take 8 to 10 months to begin investigating his case.

The report pointed to a cavalier attitude by many Wage and Hour Division investigators, saying they often dropped cases when employers did not return calls and sometimes told complaining workers that they should file lawsuits, an often expensive and arduous process, especially for low-wage workers.

  This is our government at work folks! They won’t take the time to go after employers that are screwing their workers, but they’ll damned sure hand some of those same employers a fist full of “ bailout “ money. I guess that you and I are now “ owned “ by our employers.

Technorati Tags: Government,Wage and Hour Division,Workers Rights,Minimum Wage Laws.Politics