21st Century Progressive

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Dealing with the recession: A comparative study of stimulus v.s austerity

The global economic recession that began in 2008 has prompted sundry reactions from governments across the world. While increasing government spending was the initial reaction of most leaders (most notably in the United States and China), debates have recently focused on the success of stimulus compared to austerity measures. The reason stimulus is more effective is because during economic recession both business investment and consumer spending drop so dramatically that government must spend money in order to maintain economic stability. Spain’s reaction to the global recession has provided empirical proof that austerity measures do not lead to economic recovery, while Germany’s reaction provides evidence of stimulus successfully bringing a nation out of recession, or at least into economic stability.

 

The global economy, in the 21st century, is powered by spending. People in one country make money and use it to buy goods manufactured in another country. Workers receive money for manufacturing these goods, and in turn go out and spend that money as well. Businesses also spend money when they invest in buying new equipment, raw materials, office supplies, and services. Government pumps money into the economy when it pays for infrastructure, government employees, and social programs. So consumer spending, business investments, and government spending make up three key elements to economic growth and stability. In economic recessions, consumer spending and business investment decrease and government must make up for that decrease by spending more than usual or risk further economic downturn (Krugman 2009). Austerity measures are policies that cut government spending and often increase taxes in an attempt to decrease government debt. The idea is that a government with sound finances will generate confidence from its lenders and its consumers, and maintain economic stability. This does not, however, prove to be absolutely true.

 

Spain’s reaction to the global recession was initially one of the largest stimulus programs in Europe, but quickly became a harsh austerity measure that damaged Spain’s recovery. Including increased unemployment aid, Spain’s stimulus was 82 billion, or 11.2% of their GDP. It included tax cuts as well as money for infrastructure projects and to help the auto industry. Later in 2009, however, Spain bowed to pressure from the European Union to get its finances under control by withdrawing some of the stimulus planned and implementing austerity measures instead. They increased taxes and cut government spending in an attempt to reduce the budget deficit from 11.2% in 2009 to 3% in 2013. The Spanish economy, however, couldn’t afford to make these cuts because in order to get out of economic recession they would have to make major changes to their institutions. They needed to invest heavily in education, research, and development since they weren’t leaders in productivity, quality, innovation, or educational achievement (Spanish citizens complete three less years of schooling on average than Germans or Americans). The tax increases and spending cuts simply exacerbated these problems and Spain slipped into further economic recession (Salmon 2010). In 2009 and 2010, despite austerity measures, Spain’s GDP growth was negative, and unemployment has steadily risen from a low of 8.3% in 2007 to 20.2% in 2010 (EuroStat 2010; OECD 2011).

 

Germany is often cited as an example of austerity measures bringing a nation’s economy out of recession, but Germany’s recovery is actually evidence of the power of stimulus. While it is true that Germany has been making vociferous arguments for austerity more recently, they did not do the same when the fate of their economy was uncertain. In 2008, Germany passed a €31 billion stimulus package and also increased their debt ceiling by €8 billion (Forbes 2008). Germany’s GDP growth was negative in 2009 during the worst of the recession but returned to normal by 2010 (EuroStat 2010). Unemployment has also been dropping in Germany, even returning to pre-recession levels by the end of 2010 (OECD 2011).

 

There are two reasons why Germany’s rebound has been so successful. One is because of a unique short time worker program imbedded in their stimulus package. It allowed companies to decrease people’s working hours dramatically without laying off anyone, and the government paid 60% of the workers’ lost wages. This way companies could save just as much money as laying people off, but not lose any of the talent that they wanted to keep. Also, money remained in German pockets as if they were still fully employed so consumer spending remained near pre-recession levels and consumer confidence didn’t take a huge dip as in most countries (Kopinski 2010). The other reason for Germany’s success is that they export to nations that passed large stimulus packages (notably the United States and China). Since 26.8% of German GDP is based in industry, the stimulus programs in the U.S. and China have fueled demand for German manufactured goods and put Germans back to work (U.S. Department of State; Evans 2011).

 

One can look to both the present and the past to see how preferable stimulus is to austerity. The oil supply shock of 1973 to 1982 had the same effect on the economies of both Western Europe and the United States. After 1982, however, the U.S. started spending money and creating deficits almost as fast as Europe was cutting spending and creating surpluses. The 1980’s were a time of economic prosperity for the U.S., while Western Europe saw unemployment rates nearly double (Blanchard 1987). It became clear then that stimulus was the best way to climb out of recession. Recent events in Spain have proven how austerity can worsen an already bad situation, while events in Germany have shown that stimulus – by both a nation and its trade partners – can successfully bring a country out of recession. History and recent evidence shows that in this time of global recession it is stimulus that will keep the world from falling into another Great Depression.

 

 

 

 

 

 

 

 

Works Cited

 

Blanchard, Oliver, and Lawrence Summers. “Business Forum: Unemployment must be

attacked; an austerity that’s wrecking Europe.” New York Times. New York Times. 8

 Feb. 1987. EBSCO. 15 Feb. 2011

 

Evans, Steven. “Why do the German and U.K. economies differ sharply?” BBC News. BBC

 News. 15 Feb. 2011. Web. 15 Feb. 2011. < http://www.bbc.co.uk/news/business-

12447607>

 

Eurostat. “Real GDP Growth Rate.” Eurostat. European Commission. 2010. Web. 15 Feb.

2011.<http://epp.eurostat.ec.europa.eu/tgm/refreshTableAction.do;jsessionid=9ea

7974b30dcd0a6af27d46948d78864eef115014d68.e34SbxiPb3uSb40Lb34LaxqRb3

eSe0?tab=table&plugin=1&pcode=tsieb020&language=en>

 

Forbes. “Europe’s fiscal stimulus plans to tackle crisis.”Forbes.com. Reuters, 8 Dec. 2008.

Web. 15 Feb. 2011. <http://www.forbes.com/feeds/afx/ 2008/12/08/ afx5 79 3036.html>

 

Kopinski, Mark. “Germany and the U.S.: Two Takes on the Economic Recovery.” American

 Century Investments Blog. American Century Investments, 5 Nov. 2010. Web. 15

Feb. 2011.< http://americancenturyblog.com/2010/11/germany-and-the-u-s-two-

takes-on-the-economic-recovery/>

 

Krugman, Paul, and Robin Wells. Economics. New York: Worth Publishers, 2009. Print.

 

OECD. “Employment and Labour Markets: Key Tables from OECD.” OECD iLibrary.

 Organization for Economic Co-operation and Development, 3 Jan. 2011. Web. 15

 Feb. 2011. < http://www.oecd-ilibrary.org/employment/unemployment-

rate_20752342-table1>

 

Salmon, Keith. “Boom to bust – Reconstructing the Spanish Economy.” International Journal

 of Iberian Studies. 23 (2010): 83-91. Web. 15 Feb. 2011.

 

U.S. Department of State. “Background Note: Germany.” U.S. Department of State. U.S.

Bureau of European and Eurasian Affairs, 2011. Web. 15 Feb. 2011.

<http://www.state.gov/r/pa/ei/bgn/3997.htm>

2,803 notes

Kate Spencer: On Seeing Lena Dunham Naked

katespencer:

When I was 10 years old, some moms in my fifth grade class organized an end of the year pool party for our entire grade. It was one of the first times I can recall being sent into a tailspin of anxiety for weeks, because it meant I had to wear a bathing suit in front of my classmates. After many sleepless nights agonizing and envisioning endless mocking and scrutiny, I opted for a giant t-shirt and jumped in the pool fully clothed. Looking at photos of myself at that age now, I can’t imagine what I was thinking. I was completely average sized (though tall and developing). And yet I was putting myself through an incredible amount of body shame, while only a child.

I thought about this pool party this week when discussing Sunday night’s episode of Girls with various women on Twitter and during the daily web chat I host for VH1. Something very obvious hit me, and I haven’t been able to shake it: Lena Dunham is really the first woman I’ve ever seen on-screen who looks like me. But not only that - she’s comfortable in her skin, in her nakedness, in her sexuality, and as herself.

Of course she doesn’t exactly look like me. I am tall, she seems short. She has smaller breasts, I’ve had the same saggy size-C mom boobs since I was 14. But her thighs touch together when she stands, her shape moves, her arms aren’t skeletal, and sometimes her clothes don’t fit “right.” (See: the endless comments about the jumper she wore in ‘One Man’s Trash.’) But even in her own form, I still see myself. I see my thighs that touch when I stand, I see the round yet flat shape of my ass that moves when I do, I see my own non-skeletal arms. And every time Hannah/Lena takes off her clothes, every time she establishes that she is, for the most part, comfortable in her body, it gives me a little bit of hope for myself.

Because I am thirty-three years old, and I am still not comfortable in my own body. I haven’t been since I was eight and I sprouted breasts before everybody else, and would change into my bathing suit in the bathroom stalls at camp, certain that everyone would be horrified by what they saw. I wasn’t when I was twelve and towered over boys, slouching to bring myself down in inches. Nor was I at nineteen, skinny-dipping in the waters off of Long Island with my closest college friends. Even though I was drunk and stoned the shame was still able to find a way in, and I hid my body with my hands as everyone ran laughing into the ocean in the middle of the night.

I was not comfortable in my body in my twenties, when a male improv student of mine came to see me perform at the UCB Theatre and then said I slouched too much and needed to work on my stage presence because I was setting a bad example for my students. I wasn’t when I would start dating people and upon waking up next to them in the morning, would scurry off to the bathroom with my breasts in my hands because I was embarrassed about their size. I wasn’t when I dealt with the death of my mother by compulsively dieting and exercising, because it was the only way I could have control over my emotionally rudderless mess of a life. And I wasn’t after I gave birth to my daughter at thirty-one, and would drag my exhausted body to the basement of a temple to weigh in at Weight Watchers, desperate to return to someone I no longer would ever be.

The thing about self-inflicted body shame and self-loathing is that it seeps into other aspects of your life. It makes you feel unworthy in other situations; you give yourself less and less agency because really - why should you have any? It’s a cycle of worthlessness that weaves its way into social interactions, sexual relationships, and random moments of your life. It’s vicious and is something I am constantly aware of, something I constantly trying to improve upon and change in myself. And I’m confident from the many conversations I’ve had with other women that my experiences are hardly unusual. 

So please, Lena Dunham, don’t listen to commentary on your shape and don’t stop being naked constantly on-screen. Don’t stop having lots of sex in Girls and please do ask another lover on the show to make you come first. That’s not being “ungenerous” (ugh Slate, your review in particular really sucked) it’s being an empowered and confident sexual being.

When people come down on Lena Dunham for these things, they’re coming down on all women. They’re reinforcing the negative criticism and commentary many of us already put upon ourselves. 

And that…that is the real shame.

1,258 notes

Every year on Ronald Reagan’s birthday there’s always so much pressure about how to best celebrate.

Should I declare ketchup is a vegetable for all those overfunded public school kids or shut down all those defunded mental hospitals so those nice folks can get some fresh air? Or just never mention AIDS? Oh, too late, I just mentioned AIDS. Well, maybe I should just bake a big expensive cake that most Americans will never get a piece of and then make your grandkids pay for it.

The point is, there are so many ways to honor Reagan’s achievements.

Achievements like vetoing any sanctions against South African apartheid while talking a lot about freedom. Or union-busting the air traffic controllers even though he used to run a union and all. Or signing California’s Therapeutic Abortion Act of 1967 into law. Just Google that. He really did that.

How about running for president promising to never negotiate with terrorists, then secretly selling arms and weapons to the same Iranian terrorists who helped kill our Marines in Beirut while already arming the Iraqis that they’re at war with — arming both sides in the same war — using that money to illegally fund the contras in Central America after Congress passed a stuffy old law saying he couldn’t, lying about the size and amount of shipments, saying he forgot he did all that stuff, and then helping his VP become president, who then pardoned everyone convicted so they could all walk away clean?

Pretty impressive when you consider Bill Clinton couldn’t even pull off one lousy Hummer.

Now, some of our conservative brothers and sisters might think this is mean, my reciting several actual things Reagan actually, really did. But Reagan always seemed like a nice guy. I don’t want want to be mean to him. If I was gonna be mean, I’d mention how he tried really hard to keep Martin Luther King Day from ever becoming a national holiday — because he did.

So what about the positives?

Like raising the debt limit 17 times. Or raising taxes 11 times because the economy needed it. Giving amnesty to 10 million undocumented immigrants. Obama’s only offered the Dream Act, which makes them actually work for it.

Reagan talked to our enemies, dreamed of a world with no nukes, he grew government by 61,000 jobs — he did, Department of Veterans Affairs. Ronald Reagan banned all torture and did all kinds of other stuff Fox News really wants you to forget. Reagan even defunded the public school system, which wasn’t a good thing, but it probably led directly to MTV picking up “Jersey Shore.”

Look, I’m gonna celebrate by remembering the young president of my union, the Screen Actors Guild, the young Ronald Reagan who once said, “One of the most elemental human rights is the right to belong to a free trade union.”

And I’m gonna wish peace on his soul, and I’m gonna support an assault weapons ban — just like gun violence victim President Ronald Reagan did in 1994.

John Fugelsang (via current)

Ronald Reagan: the actual worst.

(via stfuconservatives)

Ronald Reagan was the devil.

(via knowledgeequalsblackpower)

(via knowledgeequalsblackpower)

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Why Obama’s Second Inaugural Was Not A ‘Far Left’ Speech, In One Graphic

6dogs9cats:

thepoliticalfreakshow:

After President Obama finished his second inaugural speech, Republicans jumped to claim that it was a “full-throated defense of government activism,” and that “he seeks to move the country even further left.” Overall, the conservatives concluded, the speech was partisan.

The only problem? It wasn’t. On every major issue addressed during the inaugural on Monday, a majority of the public agrees with Obama. The speech was not so much a shift to the left as a microphone for the majority.

Here’s a look at the points of Obama’s speech, by the numbers:

The problem here is, some on the left keep letting many on the right dictate the terms.  The lefties who refuse to stand as one, who continue to divide and who want 100% of everything will drag us back down to nothingness, the nothingness we had for over 30 years when conservatives ran this country.  SOME ON THE LEFT BETTER LEARN LOYALTY FIRST, then strive to fix problems rather than making them worse. And by all means quit jumping on board with the libertarian mentality.  That is what got us into this mess in the first place…..the grass is not greener on the other side!

(Source: thepoliticalfreakshow)

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odinsblog:

Disturbing Truths on Structural Racism In Our “Justice” System
*White Defendant / Black Victim (19)
*Black Defendant / White Victim (257)
note: these figures represent the number of trial cases that resulted in the death sentence and not necessarily all interracial murders (such as incidents resulting in death, but designated accidental, “self defense” or Stand Your Ground), thus even the decision to try an individual for murder seems highly race dependent. Stated differently, only 19 cases resulted with capital punishment where a white defendant was actually charged with killing a black victim.
“In 82% of the studies [reviewed], race of the victim was found to influence the likelihood of being charged with capital murder or receiving the death penalty, i.e., those who murdered whites were found more likely to be sentenced to death than those who murdered blacks.”
- United States General Accounting Office, Death Penalty Sentencing, February 1990

odinsblog:

Disturbing Truths on Structural Racism In Our “Justice” System

*White Defendant / Black Victim (19)

*Black Defendant / White Victim (257)

note: these figures represent the number of trial cases that resulted in the death sentence and not necessarily all interracial murders (such as incidents resulting in death, but designated accidental, “self defense” or Stand Your Ground), thus even the decision to try an individual for murder seems highly race dependent. Stated differently, only 19 cases resulted with capital punishment where a white defendant was actually charged with killing a black victim.

In 82% of the studies [reviewed], race of the victim was found to influence the likelihood of being charged with capital murder or receiving the death penalty, i.e., those who murdered whites were found more likely to be sentenced to death than those who murdered blacks.”

- United States General Accounting Office, Death Penalty Sentencing, February 1990

(via commodifiedsouls)

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Am I Grown Up Yet?: HBO's Girls & its lack of diversity

chhoodjr:

I took a minute to watch Girls and digest it.  My first reaction was that it’s more or less Sex in the City with “ugly people” (I use that term lightly, obviously those girls aren’t hideous but they are far from Sarah Jessica Parker glamorous).  After really considering what I was watching, I felt myself relating to Dunham as a twenty-something year old writer who essentially has no idea if she’ll ever make a career out of her passion.  All her friends on the side are boring to me (except the pseudo-British Nanny), but they are girls I’ve known in some respect.  

I won’t fault Dunham on her lack of diversity, maybe the life she comes from is exactly as it’s portrayed.  I think it’s fair to say many girls come from that insular of a community.  Maybe it was self serving but her critics in this regard have to consider that what makes her authentic is that she is writing something that she is kindred with.  Inserting a minority face on a white role would be just as bad, even worse.  The Donald Glover insertion will be…well…time will tell.  

Shonda Rimes has done a lot for creating roles for her face and the first time she won an Emmy, recited her experience of getting Grey’s on the air, “everyone at the Network said it wouldn’t work, too much diversity, not used to seeing Black and Asian doctors, etc.”  

Maybe it’s fair to say Dunham came across her share of opposition because of her looks and her awkwardness, although Dunham cannot deny her White Privilege.  An all-white cast can be picked up by HBO, chances of an all-black cast being picked up by HBO is slim.  Chances are the writer would be pigeonholed and sent to BET citing “that show has less appeal”.  This only strengthens my belief that diversity in front of the camera will not happen until there is diversity behind the camera.  So if Dunham garnered her success from hard work and telling her story, then ethnic writers should not be faulted on telling ethnic stories, as they are no different from “mainstream media” (coded language for white media).  The questions we as an audience should be asking is, who are these people in the background, controlling the distribution, who for the most part believe that minority faces cannot carry mass appeal? 

Filed under girls hbo lena dunham diveristy race racism ethnicity hbo hbo girls girls

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We should not deceive ourselves: We enjoy sex scenes because we enjoy seeing people whom some critical mass would like to fuck, fucking each other. And this is not an egalitarian phenomenon—Billy Bob Thornton and Halle Berry are much more common than the opposite. (Talking gender here, not race, which is another convo.) Occasionally a sex scene advances narrative, but mostly it’s there for us—and mainly us dudes.


What Girls says is “Fuck the gaze.” Lena Dunham ain’t really performing for you. She’s saying people like me—which is most of you—like to fuck. And in a real narrative of real life, the people who do most of the fucking don’t actually look like Victoria Secret models. Your expectations for what fucking should look like are irrelevant. Here is how it looks like to the narrator. I kind of love that. In this (perhaps limited) sense, I can understand the “For Us, By Us” acclaim. The show’s disregard for male notions of sex is pretty profound. And it achieves this while still giving us a fairly interesting cast of male characters.

Lena Dunham and Democratic Nudity - Ta-Nehisi Coates (via emchughes)

(via emchughes)