I found this New York Times article by way of HuffingtonPost. Any one surprised by this has his head firmly in the sand. It was only a question of when employers would move from furloughs to outright pay cuts--not if. On the one hand human labor is very expensive--for employers because it is usually the largest item on their books. On the other it is getting very cheap--there are so many unemployed that getting lower cost replacements is not very hard. I did a rough calculation of what income Chicago city employees have lost with the furloughs and came up with something like 10%. I would almost bet that even if public employees take the outright cuts in wages the furloughs will continue. Chicago alone is looking at a $600+million deficit in next year's budget and have few resources to close it. The Illinois budget (which hasn't been passed yet) is somewhere north of $12 billion. I asked sometime ago (when the furloughs first got going) when would employees decide that the something they were preserving by accepting was indistinguishable from nothing.
So the economic recovery is waiting on the consumer, according to HuffingtonPost. If this household is typical of any significant portion of the rest of America, the economic recovery is going to be waiting a good while. Our savings rate may actually be higher than the 6+% cited in the story. However, we haven't gone to generic brands totally. We are far more discriminating in our purchases. Sometimes we find that 'cheap is not our friend.' Quality may be worth paying for and, if it is, we do. We have also shifted to using our debit cards though we keep the credit card (notice the singular) for specific purchases. If we can't afford it on the debit cards, we don't buy it.
This story from the New York Times (by way of Google News) illustrates so well why politics absolutely infuriates me. A bill, or rather competing Democrat and Republican bills, designed to address the consequences of the BP oil spill have been withdrawn because 'moderate' Democrats want changes. The major questions involve the cap on liability for companies involved in a spill and revenue sharing. On the first--I think there should be no cap. Any damage caused by a spill (accidental or negligent) should be set right by the company, or companies, involved. That includes both environmental and economic damage. I don't care if the lack of a cap would deter small drillers. BP (and probable others) hoped to hide behind a ridiculously small liability cap. Removing the liability cap would shift the economic calculations for all drillers, small and large, toward safety. On the revenue sharing--I think that the local states and areas should get a larger share of the revenue.
I have seen stories for the last couple of weeks about the heat wave in Russia. Evidently the record heat has translated into a hellish fire season. Look here for some of the details.
Toby Barlow at HuffingtonPost has an excellent rant on the topic of climate change and the news media. I said above that I have seen stories for the last couple of weeks on the Russian heat wave. Where I have NOT seen these stories is in the mainstream media news reports. The first report I saw was on a blog and the author was cautious about mentioning it because his source was the Chinese media. He was not sure how far to trust that source. I decided to check it out further and found the story on the English language version of Pravda. I would say that was confirmation. As Barlow notes no one in our media talks about the effect of the heat on the Russian wheat crop even though Russia is a major exporter. What effect, you ask? Perhaps as much as 20+% loss. According to Russian sources. Instead, we are bombarded with worthless 'news' about how poor Lindsay suffered in jail and that maybe Bret will retire.