Archive for November, 2008
The economic mess is getting worse:
The state of Oregon is predicting a major revenue shortage—perhaps as much as a billion dollars—and thinking about cuts. The Oregon Center for Public Policy says it is a revenue problem not a spending problem and suggests targeted ways to boost revenue–like deal with the ever shrinking corporate contribution to our taxes.
- Harry Esteve and Michelle Cole, “Recession slices nearly $1 billion from Oregon budget,” The Oregonian, November 19, 2008.
- Charles Sheketoff, “Governor and Legislature Should Solve Revenue Shortfalls With Revenue Solutions,” Oregon Center for Public Policy, November 19, 2008.
Unemployment is rising sharply, but we have a broken system. For example, “just 37 percent of unemployed Americans are receiving jobless benefits today, down from 42 percent during the 1981-82 recession and 50 percent during the 1974-75 downturn. Americans today receive a maximum of 39 weeks of unemployment benefits, down from 65 weeks in the 1970s. The average weekly benefit is $293.”
- Maurice Emsellem, Andrew Stettner, Lisa Donner, Alexandra Cawthorne, Helping the Jobless Helps Us All, The Central Role of Unemployment Insurance in America’s Economic Recovery, November 14, 2008
And then there is deflation—imagine if prices and salaries all fall while debts remain unchanged.
- Ambrose Evans-Pritchard, “Abandon all hope once you enter deflation,” Telegraph.co.uk, November 13, 2008.
Labor market trends as reported by the Wall Street Journal’s Market Watch (November 6, 2008):
- The number of U.S. residents collecting state unemployment benefits reached the highest level in 25 years, rising by 122,000 to a seasonally adjusted 3.84 million in the week ending Oct. 25.
- The economy has lost jobs for nine consecutive months. So far in 2008, nonfarm payrolls have fallen by 760,000 to 137.3 million.
- Real hourly compensation fell 1.9% in the quarter and is down 0.9% in the past year, marking the largest annual decline in 13 years.
Keep checking Recession Watch for the latest.