“Everybody’s going to have some skin in the game.”

(10 am. – promoted by ek hornbeck)

On the topic of cutting deficits at the expense of the social safety net, Barack Obama is a genuine charmer:

Everybody’s going to have some skin in the game.

Digby nails the key problem with Obama’s channeling of Rahm Emanuel:

The problem, of course, is that the best case has millionaires “sacrificing” being able to buy a bigger airplane while the average retiree has to sacrifice eating protein. This “game” we’ve all got our skin in has some much more serious consequences for some of us than others: since certain of the wealthy players just crashed the financial system a whole lot of soon-to-be seniors lost their nest eggs in both the real estate and stock markets (and are being priced out of the health care market just when they need the coverage the most.) If there’s a worse time to require these particular people to sacrifice more I don’t know what it is.

It’s also true that often the people for whom “sacrifice” is nothing more than a minor inconvenience are prone to lecture those for whom it is quite painful. It’s irritating.  

It’s well beyond “irritating,” beyond the need for sensitivity training, even beyond infuriating, embittering, enraging, or making my blood boil.  This wanker is a total riot, a real side-splitter.  A tumultuous uproar.  A howling, boisterous romper stomper of high jinx and merry-making.  

What is it about power that causes elites to become so self-absorbed that, to the rest of us, they appear to have contracted a psychopathic autism with a tendency, a full-blown complex, really, to obsessively pick at other people’s skin?

Mr. President seems to be unaware that our skin, that is the skin of 90% to 99% of the people, has been in the game for the past 40 years.  And the lower down you have been in the income percentiles, the more you’ve gotten flayed.  That those of us who have worked tenaciously to do good work for ourselves and our society have been increasingly denied the opportunity to do so by the autistic wankers hoovering up all the goddamned money and drinking our milkshakes until they are completely blimped out and we’re destitute.  

Where’s your awareness Mr. Most Powerful Man in the World?

Fortunately, our noble friend and handy DEC-mate, Pluto, list-processes David DeGrew:, to provide the Presidential Cliffs Notes version of the results of the past 40 years off economic policy:

1.) America is the richest nation in history, yet we now have the highest poverty rate in the industrialized world…50 million Americans currently live in poverty.

2.) 50 million people need foodstamps to eat.

3.) 50% of all American children will use foodstamps at some point in their childhood.

4.) 20,000 people are being added to these totals everyday.

5.) In 2009, one out of five households didn’t have enough money to buy food.

6.) In households with kids, this statistic increased to 24%.

7.) We have 50 million people living without health insurance.

8.) 1.4 million Americans filed for bankruptcy in 2009; this is an increase of 32% versus 2008.

9.) Medical bankruptcies are responsible for approximately 60% of all bankruptcies. Over 75% of all people who file bankruptcies due to midcal costs have health insurance.

10.) We have the most expensive health care system on the planet; we’re forced to pay twice as much for it as other developed countries; but we rank only 37th in the world in terms of quality of care.

11.) Americans have lost approximately $5 trillion from their pensions and savings since this economic crisis began.

12.) We’ve lost $13 trillion in home value during this period, as well.

13.) “During the first full year of the crisis, workers between the age of 55 – 60, who have worked for 20 – 29 years, have lost an average of 25% of their 401k.”

14.) Personal debt has risen from 65% of annual income in 1980 to 125% today.

15.) 5 million people have lost their homes, already.

16.) 13 million families are expected to lose their home by 2014,.

17.) Currently, 25% of all American homeowners are “under water,” owing more on their homes than they’re worth.

18.) Deutsche Bank predicts that 48% of U.S. homeowners will be underwater by the end of 2011.

19.) Every day, 10, 000 U.S. homes go into foreclosure.

20.) Homelessness is dramatically increasing, with over 3 million Americans currently considered homeless.

21.) The fastest growing segment of the homeless population is single parents with children.

22.) The U.S. prison population is now 2.3 million. We incarcerate more people (as a percent of our population) in the U.S. than anywhere else in the world.

23.) A recent study by the Hartford Advocate tells us that a new prison opens every week somewhere in America.

24.) Government statistics really don’t tell us the entire story. Take the unemployment rate…

From DeGraw, directly…

Mass Unemployment – The government unemployment rate is deceptive on several levels. It doesn’t count people who are “involuntary part-time workers,” meaning workers who are working part-time but want to find full-time work. It also doesn’t count “discouraged workers,” meaning long-term unemployed people who have lost hope and don’t consistently look for work. As time goes by, more and more people stop consistently looking for work and are discounted from the unemployment figure. For instance, in January, 1.1 million workers were eliminated from the unemployment total because they were “officially” labeled discouraged workers. So instead of the number rising, we will hear deceptive reports about unemployment leveling off.

On top of this, the Bureau of Labor Statistics recently discovered that 824,000 job losses were never accounted for due to a “modeling error” in their data. Even in their initial January data there appears to be a huge understating, with the newest report saying the economy lost 20,000 jobs. TrimTabs employment analysis, which has consistently provided more accurate data, “estimated that the U.S. economy shed 104,000 jobs in January.”

When you factor in all these uncounted workers – “involuntary part-time” and “discouraged workers” – the unemployment rate rises from 9.7 percent to over 20 percent….

Even based on the “official” unemployment rate, just to get back to the unemployment level of 4.6 percent that we had in 2007, we need to create over 10 million new jobs, and most every serious economist will tell you that these jobs are not coming back.

25.) Millions of Americans are at a point where their unemployment benefits are now coming to an end.

26.) More workers have been out of work for a lengthier period of time than at any time since they started tracking these statistics.

27.) A record 20 million Americans qualified for unemployment insurance in 2009.

28.) Without federal intervention, 27 states would have run out-or did run out-of funds to cover these claims.

29.) 40 state unemployment programs are expected to go broke.

30.) It is projected by many that millions of Americans will remain unemployed for very extended periods of time. (They already are.)

31.) More than six people are looking for work for every job that’s available.

32.) Americans are already the most productive workers on the planet; productivity increased by annualized rate of 9.5% in the third quarter of 2009, alone, but labor costs decreased by 5.2%.

33.) As a result of #32, above, some companies are now experiencing record profits. 78% of the 220 of the companies in the S&P 500 had “…’better-than-expected profits’ with earnings 17 percent above expectations, ‘the highest for any quarter since Thomson Reuters began tracking data.’ ”

34.) According to the US Department of Labor’s Bureau of Labor Statistics, household income fell by 3.8% in 2008, and that was while the unemployment rate was at 5.8%

35.) “With the unemployment rate now at 10 percent, median income has been falling at a 5 percent rate and is expected to continue its decline.”

Meanwhile, as penitence for making half of all children in the U.S. go hungry while reaping excess profits and destroying our lives, all at taxpayer expense, the exemplary Lloyd Blankfein ingurgitates $9 million more in child kibble, and in excess of his regular exorbitant paycheck.  That’s not exactly taking one for the team, is it Mr. President.  After dealing an economic death blow to the rest of us, the blimped-out Blankfein explains,

And my straw reaches acroooooooss the room, and starts to drink your milkshake… I… drink… your… milkshake!  Slu-u-u-u-r-r-r-r-r-p-p-p! ! !

Now, mesmerized by the dream world of his economists and blimped-out bankers, Obama dares to speak of averting the economic catastrophe, even after throwing gazillions of trillions at the wall on which nothing has stuck.  Financial Times’s Martin Wolf brilliantly identifies two possible outcomes:

Now, after the implosion, we witness the extraordinary rescue efforts. So what happens next? We can identify two alternatives: success and failure.

By “success”, I mean reignition of the credit engine in high-income deficit countries. So private sector spending surges anew, fiscal deficits shrink and the economy appears to being going back to normal, at last. By “failure” I mean that the deleveraging continues, private spending fails to pick up with any real vigour and fiscal deficits remain far bigger, for far longer, than almost anybody now dares to imagine. This would be post-bubble Japan on a far wider scale.

Or to paraphrase the comedy stylings of our favorite grease monkey Tim Geithner: We can’t have fiscal responsibility until we have economic growth.

How is that credit engine successfully re-igniting?  According to the fine folks over at The Automatic Earth:

• “US bank lending falls at the fastest rate in history”

• “Lending to British businesses falls at record pace”

• “UK mortgage lending falls to 10-year low

• “Shock as British deficit equals that of Greece” and

• “Britain posts first deficit for January since records began”.

The engine sputtered and died.  US lending falls at epic pace.  

U.S. banks posted last year their sharpest decline in lending since 1942, suggesting that the industry’s continued slide is making it harder for the economy to recover. While top-tier banks are recovering at a faster clip, the rest of the industry is still suffering, according to a quarterly report from the Federal Deposit Insurance Corp. Banks fighting for survival, especially those plagued by losses on commercial real estate, are less willing to extend loans, siphoning credit from businesses and consumers.

Besides registering their biggest full-year decline in total loans outstanding in 67 years, U.S. banks set a number of grim milestones. According to the FDIC, the number of U.S. banks at risk of failing hit a 16-year high at 702. More than 5% of all loans were at least three months past due, the highest level recorded in the 26 years the data have been collected. And the problems are expected to last through 2010. FDIC Chairman Sheila Bair said banks are “bumping along the bottom of the credit cycle” and that the number of bank failures in 2010 will likely eclipse the 140 recorded last year.

Has quantitative easing even officially ended yet?  Will we have to bail out Greece?  What happens as the ARMs start resetting with gusto next month?  What happens in commercial real estate?  What happens when all those bonds begin maturing?  What happens as consumer confidence continues swooning?  What happens as smaller banks accelerate their impressions of Chinese firecrackers?  And then what happens to all the toxic debt that has never been written down?  So much for jump-starting the “liquidity crisis” with boatloads of money, growth, and the alternative known as “success.”  

Now, we have really got ourselves a debt crisis.  Bigger and Failer than ever.  Ask Alan Greenspan!

Former Federal Reserve Chairman Alan Greenspan said the financial crisis was “by far” the worst in history and called the recovery from the global recession “extremely unbalanced.”

Greenspan said that while the economy was in worse shape in the Great Depression, the recent financial crisis was potentially more harmful than that in the 1930s because “never had short-term credit literally withdrawn.”

Consumer drivers of the economy, housing and cars, are “dead in the water.”  Bottom line is that people don’t have jobs, and don’t want loans.

Also, when Greenspan says the recession is “extremely unbalanced,” he means that the lower income percentiles are getting hammered the most, whereas the rich are still doing okay.  There is no recession for the affluent, only for middle and low income folks, who like Digby said, can least afford to have any more skin in the game.  

You can safely bet your bottom dollar that they are coming after Medicare, Medicaid, Social Security, and pensions.  They want the rest of your skin in the game, and they want it now.   History says this will happen.