FRANKFURT — Ben S. Bernanke, the Federal Reserve chairman, argued Friday that currency undervaluation by China and other emerging markets was at the root of “persistent imbalances” in trade that “represent a growing financial and economic risk.”...
“Deficit countries have to do their part,” Mr. Bernanke conceded. He said that the United States needs to raise its savings rate further and cut government borrowing. He added that a cheaper dollar will not be enough.
Make no mistake about this - a low price for the yuan means low prices for Chinese consumer goods and higher material standards of living for American workers. Increasing the yuan-dollar exchange rate will mean higher prices for Chinese-made consumer goods. It is a direct tax on American consumers, mainly workers, to pay for the economic dislocations, failures, and outright thefts, of the business class. For this we needed to elect a liberal?
"Raising the savings rate" is a code phrase for two things: a) higher corporate profits, so the corporations and their stockholders can save more; and b) lower rates of consumption by the workers. Lower consumption is achieved by a combination of lower wages in inflation-adjusted dollars, higher prices for consumer goods, and increased unemployment.
Unemployment has several wonderful effects in capitalist economies. One is that it reduces consumer demand because people can't spend when they're fucking broke. Unemployment makes employers laugh in the faces of workers who want wage increases because they know there is a long line of unemployed workers who would take the job for the same money or less. And whenever a job does become available, the employers can pay the new hires even less than their current employees for the same work. This is the "two-tiered wage system" included in more and more unioo contracts and which is no longer temporary just until the recession is over. It is permanent.
It was in this context that the Republicans defeated the unemployment compensation extension bill this year. The reason given was that they were concerned it would dampen the workers' willingness to go back to work if any became available. What they really meant was that it might dampen the workers' desperation and willingness to work for greatly reduced wages.
Apparently the Republican theory is that recessions come about when millions of workers unaccountably all quit their jobs at the same time. Then they need to be coaxed back to work by the Republicans cutting off their unemployment compensation pay.
The political choices available to American voters between Democrats and Republicans is a choice between bastards and utter bastards. There is a rumor that the billionaire mayor of New York, Michael Bloomberg, might run as an independent in 2012. I am not fond of billionaires but I am so sick of the two parties I am willing to vote for almost anyone.
I don't know what chance a New York Jew has to be elected president, but if a schwarze can do it, maybe a yid can too.