Skip to content

"The Greatest Recovery": Economic Depression

by Mark Provost

In a January 2009 ABC interview with George Stephanopoulos, then President-elect Barack Obama said fixing the economy required shared sacrifice, “Everybodys going to have to give. Everybodys going to have to have some skin in the game.” (1)

For the past two years, American workers submitted to the Presidents appealtaking steep pay cuts despite hectic productivity growth.  By contrast, corporate executives have extracted record profits by sabotaging the recovery on every fronteliminating employees, repressing wages, withholding investment, and shirking federal taxes. 


The global recession increased unemployment in every country, but the American experience is unparalleled.  According to a July OECD report, the U.S. accounted for half of all job losses among the 31 richest countries from 2007 to mid-2010. (2) The rise of U.S. unemployment greatly exceeded the fall in economic output.  Aside from Canada, U.S. GDP actually declined less than any other rich country, from mid-2008 to mid 2010. (3)


Washingtons embrace of labor market flexibility ensured companies encountered little resistance when they launched their brutal recovery plans.  Leading into the recession, the US had the weakest worker protections against individual and collective dismissals in the world, according to a 2008 OECD study. (4)  Blackrocks Robert Doll explains, When the markets faltered in 2008 and revenue growth stalled, U.S. companies moved decisively to cut costsunlike their European and Japanese counterparts.  (5) The U.S. now has the highest unemployment rate among the ten major developed countries. (6).


The private sector has not only been the chief source of massive dislocation in the labor market, but it is also a beneficiary. Over the past two years, productivity has soared while unit labor costs have plummeted. By imposing layoffs and wage concessions, U.S. companies are supplying their own demand for a tractable labor market.  Private sector union membership is the lowest on record. (7) Deutsche Bank Chief Economist Joseph LaVorgna notes that profits-per-employee are the highest on record, adding, I think what investors are missing – and even the Federal Reserve – is the phenomenal health of the corporate sector.  (8)


Due to falling tax revenues, state and local government layoffs are accelerating.  By contrast, U.S. companies increased their headcount in November at the fastest pace in three years, marking the tenth consecutive month of private sector job creation.  The headline numbers conceal a dismal reality; after a lost decade of employment growth, the private sector cannot keep pace with new entrants into the workforce.   


The few new jobs are unlikely to satisfy Americans who lost careers.  In November, temporary labor represented an astonishing 80% of private sector job growth.  Companies are transforming temporary labor into a permanent feature of the American workforce.  UPI reports, This year, 26.2 percent of new private sector jobs are temporary, compared to 10.9 percent in the recovery after the 1990s recession and 7.1 percent in previous recoveries. (9) The remainder of 2010 private sector job growth has consisted mainly of low-wage, scant-benefit service sector jobs, especially bars and restaurants, which added 143,000 jobs, growing at four times the rate of the rest of the economy.  (10)


Aside from job fairs, large corporations have been conspicuously absent from the tepid jobs recovery.  But they are leading the profit recovery.  Part of the reason is the expansion of overseas sales, but the profit recovery is primarily coming off the backs of American workers.  After decades of globalization, U.S. multinationals still employ two-thirds of their global workforce from the U.S. (21.1 million out of 31.2 million).  (11)  Corporate executives are hammering American workers precisely because they are so dependent on them. 


An annual study by USA Today found that private sector paychecks as a share of Americans total income fell to 41.9 percent earlier this year, a record low. (12) Conservative analysts seized on the report as proof of President Obamas agenda to redistribute wealth from, in their words, those pulling the cart to those simply riding in it.  Their accusation withstands the evidenceonly its corporate executives and wealthy investors enjoying the free ride. Corporate executives have found a simple formula: the less they contribute to the economy, the more they keep for themselves and shareholders.  The Feds Flow of Funds reveals corporate profits represented a near record 11.2% of national income in the second quarter.  (13)


Non-financial companies have amassed nearly two-trillion in cash, representing 11% of total assets, a sixty year high. Companies have not deployed the cash on hiring as weak demand and excess capacity plague most industries.  Companies have found better use for the cash, as Robert Doll explains, high cash levels are already generating dividend increases, share buybacks, capital investments and M&A activityall extremely shareholder friendly. (5)


Companies invested roughly $262 billion in equipment and software investment in the third quarter. (14) That compares with nearly $80 billion in share buybacks. (15)  The paradox of substantial liquid assets accompanying a shortfall in investment validates Keynes idea that slumps are caused by excess savings.  Three decades of lopsided expansions has hampered demand by clotting the circulation of national income in corporate balance sheets.  An article in the July issue of The Economist observes: business investment is as low as it has ever been as a share of GDP.  (16)


The decades-long shift in the tax burden from corporations to working Americans has accelerated under President Obama.  For the past two years, executives have reported record profits to their shareholders partially because they are paying a pittance in federal taxes.  Corporate taxes as a percentage of GDP in 2009 and 2010 are the lowest on record, just above 1%. (17)


Corporate executives complain that the U.S. has the highest corporate tax rate in the world, but theres a considerable difference between the statutory 35% rate and what companies actually pay (the effective rate).  Here again, large corporations lead the charge in tax arbitrage. U.S. tax law allows multinationals to indefinitely defer their tax obligations on foreign earned profits until they repatriate (send back) the profits to the U.S.  U.S. corporations have increased their overseas stash by 70% in four years, now over $1 trillionlargely by dodging U.S taxes through a practice known as transfer pricing. (18)Transfer pricing allows companies to allocate costs in countries with high tax rates and book profits in low-tax jurisdictions and tax havensregardless of the origin of sale.  U.S. companies are using transfer pricing to avoid U.S. tax obligations to the tune of $60 billion dollars annually, according to a study by Kimberly A. Clausing, an economics professor at Reed College in Portland, Oregon. (18)


The corporate cash glut has become a point of recurrent contention between the Obama administration and corporate executives.  In mid December, a group of 20 corporate executives met with the Obama administration and pleaded for a tax holiday on the $1 trillion stashed overseas, claiming the money will spur jobs and investment.  In 2004, corporate executives convinced President Bush and Congress to include a similar amnesty provision in the American Jobs Creation Act; 842 companies participated in the program, repatriating $312 billion back to the U.S. at 5.25% rather than 35%. (19)  In 2009, the Congressional Research Service concluded that most of the money went to stock buybacks and dividendsin direct violation of the Act. (20)


The Obama administration and corporate executives saved American capitalism.  The U.S. economy may never recover. 






1. This Week ABC News with George Stephanopoulos, January 2009.


2. OECD report, U.S. lost most jobs among rich countries.  EMMA VANDORE AP Business Writer


3. Carnegie Endowment for International Peace. Policy Brief 89. November, 2010. Uri Dadush & Vera Eidelman.  Five Surprises of the Great


4. OECD Indicators of Employment Protection.,3343,en_2649_37457_42695243_1_1_1_37457,00.html


5. The Wall St. Journal. June 8, 2010. Robert Doll. Opinion. The Bullish Case for U.S. Equities.


6. Bureau of Labor Statistics.  International Labor Comparisons. Updated Dec. 2, 2010.


7. Bloomberg Businessweek. January 22, 2010. Holly Rosenkrantz.Union membership in the private sector declines to record low:


8.  Joseph Lavorgna quote: CNBC. When will profits translate into jobs?


9. UPI. Temp work becomes a fixture. Dec. 20th, 2010.


10. Restaurant industrys hiring helping to revive economy. DAYTON, Nov 28, 2010 (Dayton Daily News – McClatchy-Tribune Information Services via COMTEX):


11. Tax Notes, Martin A. Sullivan. U.S. Multinationals Cut U.S. Jobs While Expanding Abroad.


12. USA Today. May 26, 2010. Private pay shrinks to historic lows as gov’t payouts rise.


13.  New York Times. Economix blog. Catherine Rampell. Nov. 23, 2010.  Visualizing Booming Profits


14. $262 billion in equipment and software investment, calculated from EconStats.


15. ABC News. Dec. 20, 2010. Mark Jewell.  S&P 500 Companies More Than Double Buybacks in 3Q.


16. The Economist.  Companies cash piles: Show us the Money.


17. Corporate Income Tax as a share of GDP, 1946-2009.


18.  Bloomberg. May 13, 2010. U.S. Companies Dodge $60 Billion in Taxes with Global Odyssey.


19. Bloomberg. Jesse Drucker. Dec 29, 2010. Dodging Repatriation Tax Lets U.S. Companies Bring Home Cash


20.  Center for Budget priorities. Robert Greenstein and Chye-Ching Huang. Feb. 2009. Proposed Tax Break For Multinationals Would Be Poor Stimulus 
Dividend Repatriation Tax Holiday Failed in 2004, Unlikely to Work Now.

View the original article at Global Research

Related Posts with Thumbnails

Posted in Analysis & Review, New World Order.

Tagged with , , , , , , .

0 Responses

Stay in touch with the conversation, subscribe to the RSS feed for comments on this post.

Some HTML is OK

or, reply to this post via trackback.

Support #altnews & keep Dark Politricks alive

Remember I told you over 5 years ago that they would be trying to shut down sites and YouTube channels that are not promoting the "Official" view. Well it's all happening now big time. Peoples Channels get no money from YouTube any more and Google is being fishy with their AdSense giving money for some clicks but not others. The time is here, it's not "Obama's Internet Cut Off Switch" it's "Trumps Sell Everyones Internet Dirty Laundry Garage Sale". This site must be on some list at GCHQ/NSA as my AdSense revenue which I rely on has gone down by a third. Either people are not helping out by visiting sponsors sanymore or I am being blackballed like many YouTube sites.

It's not just Google/YouTube defunding altenative chanels (mine was shut), but Facebook is also removing content, shutting pages, profiles and groups and removing funds from #altnews that way as well. I was recently kicked off FB and had a page "unpublished" with no reason given. If you don't know already all Facebooks Private Messages and Secret Groups are still analysed and checked for words related to drugs, sex, war etc against their own TOS. Personally I know there are undercover Irish police moving from group to group cloning peoples accounts and getting people booted. Worse than that I know some people in prison now for the content they had on their "secret private group". Use Telegrams secret chat mode to chat on, or if you prefer Wickr. If you really need to, buy a dumb phone with nothing for the NSA/GCHQ to hack into. Ensure it has no GPS tracking on it and that the battery can be removed. These are usually built for old people to get used to technology storing only a set of numbers to call. However they have no games, applications to install or other ways people can exploit the computer tracking device you carry round with you most of the day - your smart phone. If you are paranoid ensure that you can remove the battery when travelling around and do so to prevent GPS tracking or phone mast triangulation. Even with your phone in Flight mode or turned off, it can be turned on remotely and any features like front or back cameras, microphones and keylogging software can be installed to trace you.

So if your not supporting this site already which brings you news from the Left to the Right (really the same war mongering rubbish) then I could REALLY do with some..

Even if it's just £5 or tick the monthly subscription box and throw a few pound my way each month, it will be much appreciated. Read on to find out why.


Any support to keep this site would be appreciated. You could set up a monthly subscription for £2 like some people do or you could pay a one off donation as a gift.
I am not asking you to pay me for other people's articles, this is a clearing house as well as place to put my own views out into the world. I am asking for help to write more articles like my recent false flag gas attack to get WWIII started in Syria, and Trump away from Putin. Hopefully a few missiles won't mean a WikiLeaks release of that infamous video Trump apparently made in a Russian bedroom with Prostitutes. Also please note that this article was written just an hour after the papers came out, and I always come back and update them.

If you want to read JUST my own articles then use the top menu I have written hundreds of articles for this site and I host numerous amounts of material that has seen me the victim of hacks, DOS plus I have been kicked off multiple hosting companies, free blogging sites, and I have even had threats to cease and desist from the US armed forces. Therefore I have to pay for my own server which is NOT cheap. The more people who read these article on this site the more it costs me so some support would be much appreciated.

I have backups of removed reports shown, then taken down after pressure, that show collusion between nations and the media. I have the full redacted 28/29 pages from the 9.11 commission on the site which seems to have been forgotten about as we help Saudi Arabia bomb Yemeni kids hiding in the rubble with white phosphorus, an illegal weaapon. One that the Israeli's even used when they bombed the UN compound in Gaza during Operation Cast Lead. We complain about Syrian troops (US Controlled ISIS) using chemical weapons to kill "beautiful babies". I suppose all those babies we kill in Iraq, Yemen, Somalia and Syria are just not beautiful enough for Trumps beautiful baby ratio. Plus we kill about 100 times as many as ISIS or the Syrian army have managed by a factor of about 1000 to 1.

I also have a backup of the FOX News series that looked into Israeli connections to 9.11. Obviously FOX removed that as soon as AIPAC, ADL and the rest of the Hasbra brigade protested.

I also have a copy of the the original Liberal Democrats Freedom Bill which was quickly and quietly removed from their site once they enacted and replaced with some watered down rubbish instead once they got into power. No change to police tactics, protesting or our unfair extradition treaty with the USA but we did get a stop to being clamped on private land instead of the mny great ideas in the original.

So ANY support to keep this site running would be much appreciated! I don't have much money after leaving my job and it is a choice between shutting the server or selling the domain or paying a lot of money just so I can show this material.

Material like the FSB Bombings that put Putin in power or the Google no 1 spot when you search for protecting yourself from UK Police with "how to give a no comment interview". If you see any adverts that interest you then please visit them as it helps me without you even needing to give me any money. A few clicks per visit is all it takes to help keep the servers running and tag any tweets with alternative news from the mainstream with the #altnews hashtag I created to keep it alive!

However if you don't want to use the very obvious and cost free ways (to you) to help the site and keep me writing for it then please consider making a small donation. Especially if you have a few quid sitting in your PayPal account doing nothing useful. Why not do a monthly subscription for less money instead. Will you really notice £5 a month?