It’s not the Great Vacation

It’s not the Great Vacation—for me, because I have a lot of final grading to do and essays to write and other projects to finish, or for everyone else, because. . .

1. The Great Vacation narrative fails to explain why unemployment remains so high in the United States.

The “Great Vacation” narrative holds that unemployment insurance (UI) benefits — in particular, the added weeks of benefits for the long-term unemployed that Congress has funded in the past few years — have dissuaded millions of unemployed workers from taking a job.  If, then, jobless workers would get off their duff (or if we would give them a good swift kick there), unemployment would plummet. . .

If you rely on the Great Vacation explanation, you’ve barely started your journey to understanding why unemployment is so high.

2. Inequality continues to baffle mainstream economists, like Daron Acemoglu, who at best are beginning to understand the negative effects the concentration of income and wealth can have in politics but still fail to make sense of why the economy is generating such grotesque inequalities in the distribution of income and wealth in the first place.

That’s what’s interesting about Occupy Wall Street. Its supporters aren’t just crazy lefties who don’t believe in free markets, but respected economists.

I’m definitely in that camp. I do believe in markets. I passionately believe in the importance of property rights and private property. I think they are absolute sine qua nons for prosperity. But I also believe that these things are very political and the politics shouldn’t be one-sided. Gore Vidal said, “The United States has only one party – the property party. It’s the party of big corporations, the party of money. It has two right wings; one is Democrat and the other is Republican.” If that is true, that’s a real threat to a free market and a fair society. For that reason I think Occupy Wall Street is very important. It’s a grassroots movement that tries to stand up to this tendency of our political system.

3. All the inequality that’s fit to print consists of the fact that incomes at the very top declined in 2009 (as a result of the crash of financial markets) but not the big picture of continuing grotesque inequalities.

the real, underlying truth is that the 1 percent’s loss of income is a blip in which the super rich in America experienced a decidedly modest and temporary hit when financial markets collapsed. . .

Today half the U.S. population owns barely 2 percent of the country’s wealth, putting the United States near Rwanda and Uganda and below such nations as pre-Arab Spring Tunisia and Egypt when measured by degrees of income inequality. . .

why The New York Times would wish to use outdated data to give careless readers the impression that all is hunky-dory in this nation regarding its remarkably skewed distribution of wealth is a question that only its editors and reporters can answer.

4. The International Monetary Fund is now warning that the world risks sinking into a 1930s-style slump.

On a day that saw an escalation in the tit-for-tat trade battle between China and the United States and a deepening of the diplomatic rift between Britain and France, Christine Lagarde issued her strongest warning yet about the health of the global economy and said if the international community failed to co-operate the risk was of “retraction, rising protectionism, isolation”.

She added: “This is exactly the description of what happened in the 1930s, and what followed is not something we are looking forward to.”

5. And, finally, because, even though mainstream economists and politicians ignore it, there already is a solution to economic inequality and the crisis tendencies of contemporary capitalism: worker-owned enterprises.

Some 130 million Americans, for example, now participate in the ownership of co-op businesses and credit unions. More than 13 million Americans have become worker-owners of more than 11,000 employee-owned companies, six million more than belong to private-sector unions.

And worker-owned companies make a difference. In Cleveland, for instance, an integrated group of worker-owned companies, supported in part by the purchasing power of large hospitals and universities, has taken the lead in local solar-panel installation, “green” institutional laundry services and a commercial hydroponic greenhouse capable of producing more than three million heads of lettuce a year.