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RECORD DEBT, FORECLOSURES, AND UNEMPLOYMENT PAINT A BLEAK PICTURE
by Sharon Rondeau
(Feb. 14, 2012) — The Mediterranean nation of Greece has suffered rioting, pillaging and and torching in the wake of Parliament’s approval of austerity measures to meet the demands of “bailout creditors” with the purpose of avoiding a default on its government debt.
A “bond swap deal” had been pledged by the European Union and the International Monetary Fund if Greece agreed to reduce the size of government by cutting pay and benefits for public employees, reforming pension plans, and reducing the minimum wage. The cuts have been called “massive,” and labor unions are unhappy with the concessions. It has been predicted that a Greek debt default could cause a “European banking system meltdown.”
Late on Tuesday evening, it was reported that the Greek Parliament did not meet all of the demands made by the European Union to extend another bailout to aid the country’s debt crisis.
While some cuts had been made and an initial bailout extended, taxes had still increased, and a new property tax was added in September. A sign of serious economic strife is young children being abandoned in the streets “by their poverty-stricken families who cannot afford to look after them any more.”
But is the United States heading in the same direction? Did increasing U.S. debt by $2.5 trillion help an ailing economy which Obama continues to blame on George W. Bush? Did it make Americans more independent or dependent on government entitlements?
A January 2009 report from the Federal Reserve Bank of St. Louis stated that the U.S. had predicted that “deficits” and “debt” signaled “looming disaster” prior to Obama taking office. However, with the passage of the “stimulus bill” in February 2009, instead of reductions, entitlements increased, particularly for those already receiving them. If U.S. government deficits continue and European markets continue to falter, could the recession deepen? Has America become just like Europe in regard to debt?
The debt crisis in Europe is reportedly worsening, indicating that a “world recovery” is in question.
The official U.S. unemployment rate has exceeded 10%, but the Bureau of Labor Statistics is now reporting that it has decreased for five consecutive months.
But are the statistics accurate? In May 2009, a writer at The Washington Post stated that the “actual” unemployment rate at the time was 15.8%, and another report states that the true unemployment rate could be double that which has been stated in government statistics.
Is a recovery only a “hope,” or has it begun? If the economy continues to falter, will unrest be seen in America? A report dated February 3, 2012 states that nearly half of American families are living “on the lower end of the income scale,” and some wage-earners with previous six-figure incomes now have no income at all. However, if job growth is on the rise, what has caused it to improve?
One report states that a record 1,200,000 previously-employed people were removed from Bureau of Labor Statistics figures, which might have caused the reported unemployment rate to drop.
A report from Business Insider from July 2010 stated that “the middle class is being systematically wiped out of existence in America” due to “fundamental changes.” The bankruptcy rate rose a reported 32% in 2009 from the previous year, and in 2010, Realty Trac reported that 30% of home sales were of homes which had been foreclosed and that sales were taking longer to occur. Last summer, Realty Trac stated that delays in initiating foreclosures could cause as many as 1,000,000 homes to be foreclosed upon in 2012. One source reports that each foreclosure costs the American economy $225,000 in the meltdown which began in 2008 and reportedly was “avoidable.”
What caused the meltdown: too much government regulation, too little, or neither? Is government regulation of private industry permitted by the U.S. Constitution? Have trade agreements hurt or helped U.S. deficits and employment?
More Americans are living in poverty since the financial crisis began, reported to be just over 15% in 2010, reportedly a “17-year high,” making “income and poverty issues” paramount for the 2012 election. Does poverty in America normally include comforts obtained prior to a family member losing his job? Do the unemployed need more help from the government, or less, to become self-sufficient? What will really stimulate the economy, the America people, and American innovation?
In today’s America, are citizens able to seek “life, liberty and the pursuit of happiness,” or is everything dictated by labor unions, a Congress which doesn’t listen to the will of the people, and someone who sees himself as a dictator? Will more regulation be imposed to “fix” the financial problems of the recent past, or will Americans vote for less regulation of the markets? Will the Federal Reserve take over the foreclosed home sector in another government plan to ostensibly “stabilize the housing market?”
Can America return to a free-market economy, or is socialism too deeply entrenched? Did we all agree to become socialists? Can the private sector ever become “robust” again, or will our government follow the same path as that of Greece? Was an economic collapse orchestrated to usher in socialism?
If the human race does not wake up soon to history’s mistakes and demand a different path, we are doomed. For example, if America does not return to our Constitutional roots and rule of law, we will ultimately find ourselves on the ash heap of history. America will become just another “has been” third-world country, if she survives at all.
Obama seems to be taking the economic crisis and everything else one day at a time. Why?