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WHO RULES: THE ISRAEL LOBBY
OR UNCLE SAM?
The answer
at last! Uri Avnery, former Knesset member, assesses the Lobby's
power. "If the Israeli government wanted a law tomorrow
annulling the 10 Commandments, 95 U.S. Senators (at least) would
sign the bill forthwith." But, yes, in the end the dog wags
the tail.Fifty
years ago Allen Ginsberg's "Howl" blew the cobwebs
out of millions of young minds and drove a stake through the
heart of Eisenhower's America. Lenni Brenner remembers Ginsberg
in the East Village.Dr Mengele died in exile, in disguise. Dr Ishii
died rich and recognized, in his own Tokyo home. Christopher
Reed on Japanese WW2 medical tortures and how the U.S. covered
them up.CounterPunch
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Now!
The Bureau of Labor Statistics payroll
jobs report released May 5 says the economy created 131,000 private
sector jobs in April. Construction added 10,000 jobs, natural
resources, mining and logging added 8,000 jobs, and manufacturing
added 19,000. Despite this unusual gain, the economy has 10,000
fewer manufacturing jobs than a year ago.
Most of the April job gain
--72%--is in domestic services, with education and health services
(primarily health care and social assistance) and waitresses
and bartenders accounting for 55,000 jobs or 42% of the total
job gain. Financial activities added 26,000 jobs and professional
and business services added 28,000. Retail trade lost 36,000
jobs.
During 2001 and 2002 the US
economy lost 2,298,000 jobs. These lost jobs were not regained
until early in February 2005. From February 2005 through April
2006, the economy has gained 2,584 jobs (mainly in domestic services).
The total job gain for the
64 month period from January 2001 through April 2006 is 7,000,000
jobs less than the 9,600,000 jobs necessary to stay even with
population growth during that period. The unemployment rate is
low because millions of discouraged workers have dropped out
of the work force and are not counted as unemployed.
In 2005 the US had a current
account deficit in excess of $800 billion. That means Americans
consumed $800 billion more goods and services than they produced.
A significant percentage of this figure is offshore production
by US companies for American markets.
The US current account deficit
as a percent of Gross Domestic Product is unprecedented. As more
jobs and manufacturing are moved offshore, Americans become more
dependent on foreign made goods. This year the deficit could
reach $1 trillion.
The US pays its current account
deficit by giving up ownership of its existing assets or wealth.
Foreigners don't simply hold the $800 billion in cash. They use
it to acquire US equities, real estate, bonds, and entire companies.
The federal budget is also
in the red to the tune of about $400 billion. As Americans have
ceased to save, the federal government is dependent on foreigners
to lend it the money to operate and to wage war in the Middle
East.
American consumers are heavily
indebted. The growth of consumer debt is what has been fueling
the economy. Social Security and Medicare are in financial trouble,
as are many company pension plans. Decide for yourself--is this
the economic picture of a superpower that can dictate to the
world, or is it the picture of a second-rate country dependent
on foreigners to finance its consumption and the operation of
its government?
No-think economists make rhetorical
arguments that the decline of US manufacturing employment reflects
higher productivity from technological improvements and not a
decline in US manufacturing per se. George Mason University economist
Walter Williams recently ridiculed the claim that US manufacturing
jobs are moving to China. Williams asks how the US could be losing
manufacturing jobs to China when the Chinese are losing jobs
faster than the US: "Since, 2000, China has lost 4.5 million
manufacturing jobs, compared with the loss of 3.1 million in
the U.S."
The 4.5 million figure comes
from a Conference Board report that is misleading. The report
that counts was written by Judith Banister under contract to
the U.S. Department of Labor, Bureau of Labor Statistics, and
published in November 2005 (www.bls.gov/fls/chinareport.pdf).
Banister's report was peer reviewed both within the BLS and externally
by persons with expert knowledge of China.
Chinese manufacturing employment
has been growing strongly since the 1980s except for a short
period in the late 1990s when layoffs resulted from the restructuring
and privatization of inefficient state owned and collective owned
factories. To equate temporary layoffs from a massive restructuring
within manufacturing with US long-term manufacturing job loss
indicates extreme carelessness or incompetence.
Banister concludes: "In
recent decades, China has become a manufacturing powerhouse.
The country's official data showed 83 million manufacturing employees
in 2002, but that figure is likely to be understated; the actual
number was probably closer to 109 million. By contrast, in 2002,
the Group of Seven (G7) major industrialized countries had a
total of 53 million manufacturing workers."
The G7 is the US and Europe.
In contrast to China's 109,000,000 manufacturing workers, the
US has 14,000,000.
When I was Assistant Secretary
of the Treasury in the Reagan administration, the US did not
have a trade deficit in manufactured goods. Today the US has
a $500 billion annual deficit in manufactured goods. If the US
is doing as well in manufacturing as no-think economists claim,
where did an annual trade deficit in manufactured goods of one-half
trillion dollars come from?
If the US is the high-tech
leader of the world, why does the US have a trade deficit in
advanced technology products with China?
There was a time when American
economists were empirical and paid attention to facts. Today
American economists are merely the handmaidens of offshore producers.
Apparently, they follow President Bush's lead and do not read
newspapers--thus, their ignorance of countless stories of US
manufacturers moving entire plants and many thousands of US engineering
jobs to China.
Chinese firms, including state
owned firms, have numerous reasons, tax and otherwise, to understate
their employment. Banister's report gives the details.
Banister points out that the
excess supply of labor in China is about five to six times the
size of the total US work force. As a result, there is no shortage
of workers in China, nor will there be in the foreseeable future.
The huge excess supply of labor
means extremely low Chinese wages. The average Chinese wage is
$0.57 per hour, a mere 3% of the average US manufacturing worker's
wage. With first world technology, capital, and business knowhow
crowding into China, virtually free Chinese labor is as productive
as US labor. This should make it obvious to anyone who claims
to be an economist that offshore production of goods and services
is an example of capital seeking absolute advantage in lowest
factor cost, not a case of free trade based on comparative advantage.
American economists have failed
their country as badly as have the Republican and Democratic
parties. The sad fact is that there is no leader in sight capable
of reversing the rapid decline of the United States of America.
Paul Craig Roberts was Assistant Secretary of the Treasury
in the Reagan administration. He was Associate Editor of the
Wall Street Journal editorial page and Contributing Editor of
National Review. He is coauthor of The
Tyranny of Good Intentions.He can be reached at: paulcraigroberts@yahoo.com
Now
Available
from CounterPunch Books!
The Case
Against Israel
By Michael Neumann
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