The Perils of 2012
by Joseph E. Stiglitz
January 12, 2012
The year 2011 will be remembered as the time when many ever-optimistic Americans began to give up hope. President John F. Kennedy once said that a rising tide lifts all boats. But now, in the receding tide, Americans are beginning to see not only that those with taller masts had been lifted far higher, but also that many of the smaller boats had been dashed to pieces in their wake...
The dark underbelly of the previous decade's financial boom has been fully exposed in Europe as well. Dithering over Greece and key national governments' devotion to austerity began to exact a heavy toll last year. Contagion spread to Italy. Spain's unemployment, which had been near 20% since the beginning of the recession, crept even higher. The unthinkable — the end of the euro — began to seem like a real possibility.
This year is set to be even worse. It is possible, of course, that the United States will solve its political problems and finally adopt the stimulus measures that it needs to bring down unemployment to 6% or 7% (the pre-crisis level of 4% or 5% is too much to hope for). But this is as unlikely as it is that Europe will figure out that austerity alone will not solve its problems. On the contrary, austerity will only exacerbate the economic slowdown. Without growth, the debt crisis — and the euro crisis — will only worsen. And the long crisis that began with the collapse of the housing bubble in 2007 and the subsequent recession will continue...
The good news is that addressing these long-term problems would actually help to solve the short-term problems. Increased investment to retrofit the economy for global warming would help to stimulate economic activity, growth, and job creation. More progressive taxation, in effect redistributing income from the top to the middle and bottom, would simultaneously reduce inequality and increase employment by boosting total demand. Higher taxes at the top could generate revenues to finance needed public investment, and to provide some social protection for those at the bottom, including the unemployed.
Even without widening the fiscal deficit, such "balanced budget" increases in taxes and spending would lower unemployment and increase output. The worry, however, is that politics and ideology on both sides of the Atlantic, but especially in the US, will not allow any of this to occur. Fixation on the deficit will induce cutbacks in social spending, worsening inequality. Likewise, the enduring attraction of supply-side economics, despite all of the evidence against it (especially in a period in which there is high unemployment), will prevent raising taxes at the top...
No Longer Home Sweet Home: The Ongoing Housing Crisis and the End of an Era
by Robert Reich on his blog
February 28, 2012
Economic cheerleaders on Wall Street and in the White House are taking heart. The US has had three straight months of faster job growth. The number of Americans each week filing new claims for unemployment benefits is down by more than 50,000 since early January. Corporate profits are healthy. The S&P 500 on Friday closed at a post-financial crisis high...
Yet the biggest continuing problem for most Americans is their homes.
Purchases of new homes are down 77 per cent from their 2005 peak. They dropped another 0.9 per cent in January. Home sales overall are still dropping, and prices are still falling — despite already being down by a third from their 2006 peak. January's average sale price was $154,700, down from $162,210 in December.
Houses are the major assets of the American middle class. Most Americans are therefore far poorer than they were six years ago. Almost one out of three homeowners with a mortgage is now "underwater", owing more to the banks than their homes are worth on the market...
For class warfare, there’s the 1%, and then there’s the 0.1%
by Henry Banta
April 17, 2012
The problem of income inequality has at last become a subject for political discussion. Commendable as this is there is something misleading about the current discussion that the press needs to help correct.
There is a point where sheer magnitude can change the fundamental nature of a thing – when something becomes so big, so large, so immense, that it morphs into something very different from all else that otherwise would be in the same category. The staggering growth in the wealth and income of the top 0.1% is just such a thing. It is not just bigger than the gap between the 1% and all the rest, it is so big that it presents a vastly different set of problems.
I’m not suggesting that the difference between the top 1% and the other 99% is not a problem or even that the differences between the top 5% or even top 10% and all the rest of us is not a problem. They are very serious problems. But the difference between the extremely rich – the top 0.1% – and all the rest of us has turned into something with the potential for destroying the fabric of our society and reducing our democracy to a hollow shell.
This is not a new idea. Some time ago David Cay Johnston (who won a Pulitzer for his tax reporting) suggested that the really important gap was not between the top 1% and all the rest of us, but rather between the top 0.1% and everyone else. Indeed, looking at the gap between the top 1% and all the rest is misleading because it hides how insanely large a share is taken up by this tiny 0.1% – even when compared with the share of the bottom half of the top 1%...
As Occupy Arrestees Arraigned, Iris Scans Affect Bail
by Nick Pinto
The Village Voice
March 19, 2012
The first of the more than 70 Occupy Wall Street protesters arrested Saturday afternoon and evening were arraigned yesterday in Manhattan Criminal Court...
But protesters and their legal advisers were surprised yesterday to learn that the size of their bail was being affected by whether defendants were willing to have the distinctive patterns of their irises photographed and logged into a database...
The idea of the state collecting distinctive biometric information from people who haven't even been charged with a crime yet, much less convicted of one, makes civil libertarians nervous, though, and over the last two years they've pushed back. Unlike fingerprints, they argue, no law was ever passed to require iris photographs — it's just a policy. And while police regularly tell arrestees that the photographs are mandatory, and that failing to be photographed will prolong their stay in jail, defendants have often refused to comply without serious consequence.
That appears to be changing. Yesterday, a defense lawyer had told Judge Abraham Clott she was under the impression that her client — not affiliated with Occupy Wall Street, facing charges of marijuana possession — was not legally bound to submit to an iris photograph. Clott responded in no uncertain terms: Iris photographs may be optional in the sense that the court can proceed without them if it has to, he said, for example if the photographic equipment breaks down. But they are not optional for defendants...Occupy Wall Street Rallies Monitored By Dow Chemicalby Lee Fang
February 27, 2012
Last night, Wikileaks revealed a massive trove of e-mails from the firm Stratfor. The e-mails show that the company, working on behalf of chemical giant Dow Chemical, closely monitored news coverage of the Occupy Wall Street movement. Stratfor relayed the activities of people seeking redress for the 1984 Dow Chemical/Union Carbide gas disaster in Bhopal, India, which resulted in the death of thousands and lasting environmental damage.
Many Bhopal activists joined the ranks of the Occupy movement in recent months, a trend that was noticed by Stratfor:
— Dec. 9, 2011: Stratfor e-mailed a monitoring report to Dow Chemical noting that Bhopal activists had rallied with Occupy Boston members, passed out literature, and hosted a film screening. Activists discussed how Dow is "avoiding responsibility for remediation of former UCIL factory site and compensation to gas accident victims, and greenwashing its image with the London 2012 Olympics sponsorship."
— Oct. 14, 2011: A Stratfor analyst e-mailed an update noting that a member of the "Yes Men," active in the Bhopal movement, traveled to Los Angeles and New York to participate in Occupy events.
From the e-mails, it does not appear that Stratfor worked to undermine the Occupy movement, an allegation leveled at other corporate intelligence firms. But the e-mails do serve as a reminder that powerful corporate interests are spending money to monitor the Occupy movement and its attempt to hold businesses accountable for their abuses.Why We Must Occupy Our Food Supplyby Willie Nelson and Anna Lappé
Posted: 02/24/2012 12:04 pm
Our food is under threat. It is felt by every family farmer who has lost their land and livelihood, every parent who can't find affordable or healthy ingredients in their neighborhood, every person worried about foodborne illnesses thanks to lobbyist-weakened food safety laws, every farmworker who faces toxic pesticides in the fields as part of a day's work.
When our food is at risk we are all at risk.
Over the last thirty years, we have witnessed a massive consolidation of our food system. Never have so few corporations been responsible for more of our food chain. Of the 40,000 food items in a typical U.S. grocery store, more than half are now brought to us by just 10 corporations. Today, three companies process more than 70 percent of all U.S. beef, Tyson, Cargill and JBS. More than 90 percent of soybean seeds and 80 percent of corn seeds used in the United States are sold by just one company: Monsanto. Four companies are responsible for up to 90 percent of the global trade in grain. And one in four food dollars is spent at Walmart.
What does this matter for those of us who eat? Corporate control of our food system has led to the loss of millions of family farmers, the destruction of soil fertility, the pollution of our water, and health epidemics including type 2 diabetes, heart disease, and even certain forms of cancer. More and more, the choices that determine the food on our shelves are made by corporations concerned less with protecting our health, our environment, or our jobs than with profit margins and executive bonuses...
Occupy protesters sue over free speech, force
By Erika Niedowski
December 22, 2011
Most major Occupy encampments have been dispersed, but they live on in a flurry of lawsuits in which protesters are asserting their constitutional rights to free speech and assembly and challenging authorities' mass arrests and use of force to break up tent cities.
Lawyers representing protesters have filed lawsuits — or are planning them — in state and federal courts from coast to coast, challenging eviction orders and what they call heavy-handed police tactics and the banning of demonstrators from public properties.
Some say the fundamental right of protest has been criminalized in places, with protesters facing arrest and charges while doing nothing more than exercising protected rights to demonstrate.
"When I think about the tents as an expression of the First Amendment here, I compare it to Tahrir Square in Egypt," said Carol Sobel, co-chairwoman of the National Lawyers Guild's Mass Defense Committee.
"Our government is outraged when military forces and those governments come down on the demonstrators. But they won't extend the same rights in this country," she said. "They praise that as a fight for democracy, the values we treasure. It comes here and these people are riffraff."...
S.F. police raid Occupy camp, arrest 70by Will Kane
San Francisco Chronicle
December 7, 2011
12:12 PST SAN FRANCISCO — Police raided the Occupy SF camp early today, arresting 70 campers and protesters at Justin Herman Plaza and clearing out the 2-month-old encampment.
Officers, sheriff's deputies, firefighters and public works crews converged on the camp at the foot of Market Street at about 1:30 a.m. and gave protesters five minutes to clear out, said Officer Albie Esparza, a San Francisco police spokesman...Hard Times at Occupy BostonSam Graham-Felsen
Occupy protesters take over foreclosed homes
by Les Christie
about three hours ago
NEW YORK (CNNMoney) — In more than two dozen cities across the nation Tuesday, an offshoot of the Occupy Wall Street movement took on the housing crisis by re-occupying foreclosed homes, disrupting bank auctions and blocking evictions.
Occupy Our Homes said it's embarking on a "national day of action" to protest the mistreatment of homeowners by big banks, who they say made billions of dollars off of the housing bubble by offering predatory loans and indulging in practices that took advantage of consumers...
December 6, 2011
Defying Police Blockade, Boston's Occupy Builds a Cityby Quinn Norton
In the early days of Occupy Boston, Ford, a 30-year-old bookstore owner from the white, blue-collar town of Plymouth, Massachusetts, and Alex Ingram, a 22-year-old African-American from Georgia who served in the Air Force as a linguist, would stay up late into the night in Occupy Boston's library. Enveloped by Rousseau and Chomsky, they'd ponder big ideas about how to change the system. But tonight they're grappling with a different set of issues: How do we deal with Henry, who's drunk and pissed off again and recently threatened another Occupier with a hammer? What do we say to the furious young woman who's on a manhunt for the guy who promised her forty bucks for sex and then ran off? And what the hell are we going to do about Phil?
November 30, 2011
"We're all at that stage in our lives where we should be building our careers and it's not been an option for a lot of us," says Wiley. "I often say that's why I think this movement popped up overnight and exploded, and it has so many deeply committed people.... I think maybe some of us are realizing that maybe what we'd hoped for in life isn't going to happen."...
The mud endlessly creeps up around the bottom of the jammed-together tents, and walkways made of pallets cut the camp into sections. Each walkway is named; Main Street bisects the camp, Gandhi Way leads to Dewey Square's now-decorated Gandhi statue, with its thin and irregular curves.
Gandhi's dower and determined face remains perpetually overshadowed by the skyscraping white Federal Reserve building across from Dewey, which has a kind of Stalinist Lego architecture to it...Occupy Elections, With a Simple Messageby George Lakoff
The Huffington Post
What's next? That's the question being asked as cities close down Occupy encampments and winter approaches.
The answer is simple. Just as the Tea Party gained power, the Occupy Movement can. The Occupy movement has raised awareness of a great many of America's real issues and has organized supporters across the country. Next comes electoral power. Wall Street exerts its force through the money that buys elections and elected officials. But ultimately, the outcome of elections depends on people willing to take to the streets — registering voters, knocking on doors, distributing information, speaking in local venues. The way to change the nation is to occupy elections...Taking It to the Streetsby Jane MayerThe New Yorker
for the November 28, 2011 edition
McKibben, who is an author and an environmental activist (and a former New Yorker staff writer), had been alarmed by a conversation he had had about the proposed Keystone XL oil pipeline with James Hansen, the head of NASA's Goddard Institute for Space Studies, and one of the country's foremost climate scientists. If the pipeline was built, it would hasten the extraction of exceptionally dirty crude oil, using huge amounts of water and heat, from the tar sands of Alberta, Canada, which would then be piped across the United States, where it would be refined and burned as fuel, releasing a vast new volume of greenhouse gas into the atmosphere. "What would the effect be on the climate?" McKibben asked. Hansen replied, "Essentially, it's game over for the planet."...
McKibben concluded that the pipeline couldn't be stopped by conventional political means. So, in June, he and ten other activists sent an open letter to the environmental community saying, "It's time to stop letting corporate power make the most important decisions our planet faces. We don't have the money to compete . . . but we do have our bodies." Beginning in August, the letter said, volunteers would be needed to help provoke mass, nonviolent arrests at the White House. The activists called for civil disobedience, with the emphasis on the "civil": "Come dressed as if for a business meeting—this is, in fact, serious business." Waves of neatly outfitted people started showing up at the White House, and by the time the action ended, on September 2nd, more than a thousand had been arrested at the front gate for trespassing...
In the following weeks, while the President was on his jobs tour, he was confronted at practically every stop by people wearing Obama buttons and carrying signs that quoted him saying that we can "be the generation that finally frees America from the tyranny of oil." Major environmental groups, who had been working against the pipeline from the beginning—among them the Sierra Club, Friends of the Earth, and the National Resources Defense Council—led a broader campaign. Volunteers swarmed Obama campaign offices in almost every state, and placed calls to the finance chair of the Democratic National Committee. Ranchers and indigenous people—cowboys and Indians—whose lands would be affected united in opposition at public hearings. Nobel laureates denounced the project. The Republican governor and both senators from Nebraska, whose vulnerable water supply stood to be crossed by the pipeline, sided against it...
On November 6th, exactly a year before the election, the protest returned to Washington. This time, twelve thousand people encircled the White House. President Obama was reportedly out, playing golf, but the message evidently got through to him. Four days later, he issued a statement saying that the decision on the pipeline permit would be delayed until at least 2013, pending further environmental review...
Yet the Occupy movement could do worse than to learn from the pipeline protest. The difference between the focussed, agenda-driven campaign fought by the environmentalists and the free-form, leaderless one waged by the Occupiers, the historian Michael Kazin says, is that the environmentalists grasped the famous point made by Dr. King's political forebear, Frederick Douglass: "Power concedes nothing without a demand. It never did and it never will."Bloomberg's One Percent Solutionby Chris Smith
New York Magazine
November 18, 2011
But because Bloomberg is Wall Street, the stakes and symbolism were exponentially heightened, and these eight weeks will take on outsize significance in how his twelve years in office are judged. Bloomberg ran on the premise that his money put him above politics...
Ten years later, as we move from the terror era to the income-inequality era, it is an absolutely fitting twist of fate that New York, home of Wall Street and birthplace of Occupy Wall Street, is ruled by a $20 billion man...
Bloomberg claimed it was big bad Congress that forced the poor innocent banks to make all those booby-trapped loans, and blamed Freddie Mac and Fannie Mae for fueling the bubble. Never mind that everyone from the nonpartisan Government Accountability Office to the St. Louis Federal Reserve has debunked that simplistic reasoning with actual evidence...
But one consequence of electing a mayor as wealthy as Michael Bloomberg is that he would have difficulty engaging with the mind-sets of people less well-off. And one of the victories of Occupy Wall Street is that he's had to work at it.Occupiers Occupied: The Hijacking of the First Amendmentby Robert Reich
November 16, 2011
A funny thing happened to the First Amendment on its way to the public forum. According to the Supreme Court, money is now speech and corporations are now people. But when real people without money assemble to express their dissatisfaction with the political consequences of this, they're treated as public nuisances and evicted...
But there's another alternative. If Occupiers are expelled from specific geographic locations the Occupier movement can shift to broad-based organizing around the simple idea at the core of the movement: It's time to occupy our democracy.
This Is What Revolution Looks Like
by Chris Hedges
November 15, 2011
Welcome to the revolution. Our elites have exposed their hand. They have nothing to offer. They can destroy but they cannot build. They can repress but they cannot lead. They can steal but they cannot share. They can talk but they cannot speak. They are as dead and useless to us as the water-soaked books, tents, sleeping bags, suitcases, food boxes and clothes that were tossed by sanitation workers Tuesday morning into garbage trucks in New York City. They have no ideas, no plans and no vision for the future.
Our decaying corporate regime has strutted in Portland, Oakland and New York with their baton-wielding cops into a fool's paradise. They think they can clean up "the mess"-always employing the language of personal hygiene and public security-by making us disappear. They think we will all go home and accept their corporate nation, a nation where crime and government policy have become indistinguishable, where nothing in America, including the ordinary citizen, is deemed by those in power worth protecting or preserving, where corporate oligarchs awash in hundreds of millions of dollars are permitted to loot and pillage the last shreds of collective wealth, human capital and natural resources, a nation where the poor do not eat and workers do not work, a nation where the sick die and children go hungry, a nation where the consent of the governed and the voice of the people is a cruel joke.
Get back into your cages, they are telling us. Return to watching the lies, absurdities, trivia and celebrity gossip we feed you in 24-hour cycles on television. Invest your emotional energy in the vast system of popular entertainment. Run up your credit card debt. Pay your loans. Be thankful for the scraps we toss. Chant back to us our phrases about democracy, greatness and freedom. Vote in our rigged political theater. Send your young men and women to fight and die in useless, unwinnable wars that provide corporations with huge profits. Stand by mutely as our bipartisan congressional supercommittee, either through consensus or cynical dysfunction, plunges you into a society without basic social services including unemployment benefits. Pay for the crimes of Wall Street.
The rogues' gallery of Wall Street crooks, such as Lloyd Blankfein at Goldman Sachs, Howard Milstein at New York Private Bank & Trust, the media tycoon Rupert Murdoch, the Koch brothers and Jamie Dimon at JPMorgan Chase & Co., no doubt think it's over. They think it is back to the business of harvesting what is left of America to swell their personal and corporate fortunes. But they no longer have any concept of what is happening around them. They are as mystified and clueless about these uprisings as the courtiers at Versailles or in the Forbidden City who never understood until the very end that their world was collapsing. The billionaire mayor of New York, enriched by a deregulated Wall Street, is unable to grasp why people would spend two months sleeping in an open park and marching on banks. He says he understands that the Occupy protests are "cathartic" and "entertaining," as if demonstrating against the pain of being homeless and unemployed is a form of therapy or diversion, but that it is time to let the adults handle the affairs of state. Democratic and Republican mayors, along with their parties, have sold us out. But for them this is the beginning of the end.
The historian Crane Brinton in his book "Anatomy of a Revolution" laid out the common route to revolution. The preconditions for successful revolution, Brinton argued, are discontent that affects nearly all social classes, widespread feelings of entrapment and despair, unfulfilled expectations, a unified solidarity in opposition to a tiny power elite, a refusal by scholars and thinkers to continue to defend the actions of the ruling class, an inability of government to respond to the basic needs of citizens, a steady loss of will within the power elite itself and defections from the inner circle, a crippling isolation that leaves the power elite without any allies or outside support and, finally, a financial crisis. Our corporate elite, as far as Brinton was concerned, has amply fulfilled these preconditions. But it is Brinton's next observation that is most worth remembering. Revolutions always begin, he wrote, by making impossible demands that if the government met would mean the end of the old configurations of power. The second stage, the one we have entered now, is the unsuccessful attempt by the power elite to quell the unrest and discontent through physical acts of repression...Ten Ways the Occupy Movement Changes Everythingby Sarah van Gelder, David Korten, Steve Piersanti
November 10, 2011
Before the Occupy Wall Street movement, there was little discussion of the outsized power of Wall Street and the diminishing fortunes of the middle class.
The media blackout was especially remarkable given that issues like jobs and corporate influence on elections topped the list of concerns for most Americans.
Occupy Wall Street changed that. In fact, it may represent the best hope in years that "we the people" will step up to take on the critical challenges of our time. Here's how the Occupy movement is already changing everything...UC cops' use of batons on Occupy camp questionedby Will Kane and Demian Bulwa
San Francisco Chronicle
A debate over the use of police force has reignited at the UC Berkeley campus after videos surfaced showing officers repeatedly shoving and jabbing screaming students who tried to keep officers from dismantling a nascent Occupy encampment.
The videos taken by protesters, journalists and casual observers show UC Berkeley police and Alameda County sheriff's deputies in riot gear ordering students with linked arms to leave a grassy area outside the campus administration building Wednesday. When the students didn't move, police lowered their face shields and began hitting the protesters with batons.
University police say the students, who chanted "You're beating students" during the incident, were not innocent bystanders, and that the human fence they tried to build around seven tents amounted to a violent stance against police.
But many law enforcement experts said Thursday that the officers' tactics appeared to be a severe overreaction.
Both the ACLU and the National Lawyers Guild said they had "grave concerns about the conduct" of campus police...
UC Berkeley Riot Police Use Batons to Clear Students from Sproul Plaza
by Conor Friedersdorf
November 10, 2011
In iconic Sproul Plaza, many hundreds or perhaps thousands of UC Berkeley students and Occupy Oakland activists clashed with university police late into the night Wednesday, after officers carried out instructions from administrators to clear Occupy Cal protesters from their makeshift encampment. "We formed a human barricade around our tents, and they just beat their way through it with batons," said one student. "It really, really hurt - I got the wind knocked out of me," another protester, doctoral student Shane Boyle, told the San Francisco Chronicle, showing the reporter a red welt on his chest. "I was lucky I only got hit twice," he added...
The video at the top of this post captures a violent clash that occurred earlier in the day, when police aggressively pummeled student protesters with their batons. Said Matt Welch, editor ofReason magazine, "Watch cops at Occupy Berkeley launch coordinated baton attack against unarmed students."Workers of the world, unite!
The Globalization of Protestby Joseph E. Stiglitz, who is is University Professor at Columbia University, and a Nobel laureate in economics
November 4, 2011
NEW YORK — The protest movement that began in Tunisia in January, subsequently spreading to Egypt, and then to Spain, has now become global, with the protests engulfing Wall Street and cities across America. Globalization and modern technology now enables social movements to transcend borders as rapidly as ideas can. And social protest has found fertile ground everywhere: a sense that the "system" has failed, and the conviction that even in a democracy, the electoral process will not set things right — at least not without strong pressure from the street...Which comes first: the Constitution or cities' no-camping rules?by John Hanrahan
November 1, 2011
Do many of our big-city mayors and police chiefs believe American citizens living in a democracy should have fewer rights than protesters in foreign lands do when they take to the streets to challenge their undemocratically-chosen governments? Do they believe that citizens living in this country with a Bill of Rights should be able to engage in continuing political protests, the same as citizens in non-democratic countries with no First Amendment guarantees? Do they believe that mere city ordinances, such as curfews and bans on sleeping in parks, should trump the U.S. Constitution? Do they believe that our Constitutionally-guaranteed rights of free speech, free assembly and to peaceably petition the government stop when the sun goes down and the curfew and no-camping rules kick in?
Noam Chomsky Speaks to Occupy: If We Want a Chance at a Decent Future, the Movement Here and Around the World Must Grow
November 1, 2011
In a speech to Occupy Boston, the linguist and icon hailed the "unprecedented" first weeks of OWS. He cautioned protesters to build and educate first, strike later.
Occupy Wall Street: FAQ
by Nathan Schneider
October 9, 2011
Q: I hear that Adbusters organized Occupy Wall Street? Or Anonymous? Or US Day of Rage? Just who put this together anyway?
A: All of the above, and more. Adbusters made the initial call in mid-July, and also produced a very sexy poster with a ballerina posed atop the Charging Bull statue and riot police in the background. US Day of Rage, the mainly internet-based creation of IT strategist Alexa O'Brien, got involved too and did a lot of the early legwork and tweeting. Anonymous-in its various and multiform visages-joined in late August. On the ground in New York, though, most of the planning was done by people involved in the NYC General Assembly, a collection of activists, artists and students first convened by folks who had been involved in New Yorkers Against Budget Cuts. That coalition of students and union workers had just finished a three-week occupation near City Hall called Bloombergville protesting the mayor's plans for budget cuts and layoffs. They had learned from the experience and were itching to do it again, this time with the hope of having a bigger impact. But no one person or group is running the Wall Street occupation entirely...
Of the 1%, by the 1%, for the 1%
Americans have been watching protests against oppressive regimes that concentrate massive wealth in the hands of an elite few. Yet in our own democracy, 1 percent of the people take nearly a quarter of the nation's income-an inequality even the wealthy will come to regret.
by Joseph E. Stiglitz — illustration by Stephen Doyle
for the May issue of Vanity Fair
This makes that all literally chump change—
$30.1 Trillion Dollars Worth of Value Was Lost From the Global Markets in 2008
By September 2008, average U.S. housing prices had declined by over 20% from their mid-2006 peak. This major and unexpected decline in house prices means that many borrowers have zero or negative equity in their homes, meaning their homes were worth less than their mortgages. As of March 2008, an estimated 8.8 million borrowers - 10.8% of all homeowners - had negative equity in their homes, a number that is believed to have risen to 12 million by November 2008.
And this if from them there ivy league elites—
Conclusion. Determining how that equity gap will be satisfied, and by whom, will be a major challenge over the next few years. If borrowers cannot raise the funds, then lending institutions, particularly local and regional banks and thrifts, will be confronted with severe losses. Government action will then likely be needed to prevent commercial real estate debt from derailing our fragile economic recovery. Given the potential political and economic impact, it is important that empirical work be done to fully investigate the factors that have contributed to a commercial real estate debt crisis.
It will take at least a decade to recover in real estate value from the subprime mortgage crisis... the disaster will probably echo through history...