Amped Status's List: Economy

"At least 44 million Americans have filed for unemployment in the past three months as the coronavirus pandemic devastated industries such as retail and hospitality. 
Many who lost jobs were unable to pay their rent or utilities, prompting state and federal governments to issue a temporary ban on evictions. 
But those bans are set to expire this summer, leaving many people at risk of losing their homes. "

"American slavery was technically abolished in 1865, but a loophole in the 13th Amendment has allowed it to continue “as a punishment for crimes” well into the 21st century. Not surprisingly, corporations have lobbied for a broader and broader definition of “crime” in the last 150 years. As a result, there are more (mostly dark-skinned) people performing mandatory, essentially unpaid, hard labor in America today than there were in 1830.





With 5 percent of the world’s population and 25 percent of the world’s prison population, the United States has the largest incarcerated population in the world. No other society in history has imprisoned more of its own citizens. There are half a million more prisoners in the U.S. than in China, which has five times our population. Approximately 1 in 100 adults in America were incarcerated in 2014.  Out of an adult population of 245 million that year, there were 2.4 million people in prison, jail or some form of detention center.

The vast majority – 86 percent – of prisoners have been locked up for non-violent, victimless crimes, many of them drug-related."

"Frank Clemente, ATF executive director, said in a statement that over the past three months, “about 600 billionaires increased their wealth by far more than the nation’s governors say their states need in fiscal assistance to keep delivering services to 330 million residents.”

“Their wealth increased twice as much as the federal government paid out in one-time checks to more than 150 million Americans,” said Clemente. “This orgy of wealth shows how fundamentally flawed our economic system is.”

“If this pandemic reveals anything,” Clemente added, “it’s how unequal our society has become and how drastically it must change.”

NEW FINDINGS from our @inequalityorg + @4TaxFairness:

In 3 months, the U.S. added 29 more billionaires while 45.5 million filed for unemployment.

Billionaires have seen their net worth skyrocket $584 billion, or 20%, since the beginning of the pandemic. pic.twitter.com/lXsZ9MTuwQ

— Institute for Policy Studies (@IPS_DC) June 18, 2020"...

In their weekly analysis of wealth data Thursday, the Institute for Policy Studies (IPS) and Americans for Tax Fairness (ATF) found that billionaires have seen their combined net worth grow by $584 billion in the three months since the Covid-19 pandemic shuttered much of the U.S. economy and threw more than 45 million people out of work.

Jeff Bezos, Bill Gates, Mark Zuckerberg, Warren Buffett, and Larry Ellison—the five wealthiest billionaires in the U.S.—saw their collective riches grow by $101.7 billion between March 18 and June 17, according to the new report. A dozen other American billionaires saw their wealth more than double during that same period.

"A $1.7 million stimulus check?

While wealthy Americans are not eligible for the comparatively measly $1,200 stimulus checks that are now being disbursed to many Americans, they are on pace to do even better. 43,000 taxpayers, who earn more than $1 million annually, are each set to receive a $1.7 million windfall, on average, thanks to a provision buried in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

You may or may not be surprised that some of the language conveniently inserted into the $2.2 trillion-dollar Coronavirus Aid, Relief, and Economic Security Act (CARES) skews heavily in favor of the wealthy. The provision doling out literally millions of dollars is aimed at a limitation that was created in 2017 when Republicans overhauled the tax code. It “temporarily suspends a limitation on how much owners of businesses formed as “pass-through” entities can deduct against their non-business income, such as capital gains, to reduce their tax liability,” according to The Washington Post."

"That gives the roughly 43,000 individual tax filers who make at least $1 million a year a savings of $70.3 billion — or about $1.6 million apiece, according to the Joint Committee on Taxation.

Hedge-fund investors and real estate business owners are “far and away” the ones who will benefit the most, tax expert Steve Rosenthal told the Washington Post.

Sen. Sheldon Whitehouse (D-RI) called it a “scandal” to “loot American taxpayers in the midst of an economic and human tragedy.”"

"For example, it is being reported that executives at Walmart plan to greatly increase the size of their “robot army”…

Walmart Inc.’s robot army is growing. The world’s largest retailer will add shelf-scanning robots to 650 more U.S. stores by the end of the summer, bringing its fleet to 1,000. The six-foot-tall Bossa Nova devices, equipped with 15 cameras each, roam aisles and send alerts to store employees’ handheld devices when items are out of stock, helping to solve a vexing problem that costs retailers nearly a trillion dollars annually, according to researcher IHL Group.

In addition to scanning shelves, Walmart already has a whole host of robots doing such things as scrubbing floors, unloading trucks and gathering grocery orders…

The new robots, designed by San Francisco-based Bossa Nova Robotics Inc., join the ranks of Walmart’s increasingly automated workforce which also includes devices to scrub floors, unload trucks and gather online-grocery orders.

Meanwhile, Walmart has been testing “a new employee structure” which is intended to “cut down the size of its store management staff”…

Walmart is testing out a new employee structure within its stores in an attempt to cut down the size of its store management staff.

The nation’s biggest employer is looking to see if it can have fewer midlevel store managers overseeing workers, with these managers seeing both their responsibilities and their pay increase.

So the employees that survive will get a “pay increase” to go with a huge increase in responsibility, but what about all the others that are having their jobs eliminated?

Don’t worry, because in an interview about this new initiative one Walmart executive assured us that their employees “like smaller teams”…

“Associates like smaller teams, and they like having a connection with a leader. They want something they can own and to know if they are winning or losing every day. And today that does not always happen,” Drew Holler, U.S. senior vice president of associate experience, said in an interview.

Today, Wal-Mart is the largest employer in the United States by a wide margin.

But these coming changes will ultimately mean a lot more robot workers and a lot less human workers.

Of course countless other heartless corporations are implementing similar measures.  And considering the fact that one recent survey found that 97 percent of U.S. CFOs believe that a recession is coming in 2020, we are likely to see a “thinning of the ranks” in company after company as this year rolls along.

Sadly, even if there was no economic downturn coming we would continue to lose jobs to robots.  According to one study, a whopping 45 percent of our current jobs “can be automated”…

Here’s the truth: Robots are already starting to take jobs from hourly human workers, and it’s going to continue. Research from McKinsey found that 45% of current jobs can be automated. We need to stop avoiding the situation and create real solutions to help displaced workers.

In this day and age, no worker is safe.

I know someone that gave his heart and soul to a big corporation for many years, and then one day he was called into the office when he arrived for work and he was out of a job by lunch.

He hadn’t done anything wrong at all.  It is just that his heartless corporate bosses had decided to eliminate his position throughout the entire company.

If you think that they actually care about you, then you are just fooling yourself.

Unfortunately, the job losses are just going to keep accelerating.  In fact, it is being projected that approximately 20 million manufacturing jobs around the globe could be taken over by robots by the year 2030…

Robots could take over 20 million manufacturing jobs around the world by 2030, economists claimed Wednesday.

According to a new study from Oxford Economics, within the next 11 years there could be 14 million robots put to work in China alone.

And as wealthy executives lay off low wage workers in staggering numbers, that will make the growing gap between the rich and the poor even worse…

“As a result of robotization, tens of millions of jobs will be lost, especially in poorer local economies that rely on lower-skilled workers. This will therefore translate to an increase in income inequality,” the study’s authors said.

The good news is that the full extent of this ominous scenario is not likely to completely play out.  The bad news is that this is because our society is rapidly moving toward complete and utter collapse.

I wish that there was an easy solution to this growing problem.

In a free market system, should anyone be trying to mandate that employers must hire human workers?

But if millions upon millions of men and women can’t feed their families because they don’t have jobs, that will create the sort of social nightmare that we cannot even imagine right now.

This is something that all of the 2020 presidential candidates should be talking about, because this is a crisis that is spinning out of control, and it is getting worse with each passing day."

"Washington’s influence industry, including former Trump officials and allies, has made big money helping companies get exemptions from tariffs — sometimes by undercutting small business owners like Mike Elrod."....

“There was a time when every day I dreaded opening the mail,” said Elrod, who founded a small firm in South Carolina called Eccotemp that makes energy-efficient, tankless water heaters. “The Department of Energy would put in an arbitrary rule and then come back the next day and say, ‘You’re not in compliance.’ We had no input into what was changing and when the change was taking place.”

Elrod also thought that big businesses had long been able to buy their way out of problems, either by spending lots of money on compliance or on lobbyists to look for loopholes and apply political pressure. Trump, of course, had promised to address that — to “drain the swamp.”...

Overall, Trump’s tariffs have not had the effect that the self-described “Tariff Man” promised. Companies have moved manufacturing out of China — and it has mostly gone to Vietnam, Taiwan and Mexico. Tariffs are chiefly behind a months-long decline in domestic manufacturing, Federal Reserve researchers have found. The total loss of jobs across the economy may be as high as 300,000.

But constantly up-in-the-air trade agreements and the byzantine, opaque exclusion process has been a blessing for one set of players: Washington’s influence industry, including the firms of former Trump officials and allies like inauguration committee chief Brian Ballard, former White House chief of staff Reince Priebus and Trump fundraiser Marc Lampkin.

Ballard was once Trump’s lobbyist in Florida. He’s since been dubbed “the most powerful lobbyist in Trump’s Washington.” A cancer therapy firm, Varian Medical Systems, paid Ballard and a colleague $540,000 to lobby the White House, the trade office and Vice President Mike Pence on trade issues, filings show. The outreach included a meeting with Trump’s director of trade and manufacturing policy, Peter Navarro.

Since then, four of Varian’s five exclusion requests have been approved — which, the company said in an SEC filing, boosted revenues by $23 million. (Navarro said he doesn’t intervene in the exclusion process.)

Priebus’ firm, Michael Best Strategies, was hired by a Wisconsin company, Primex, to handle exemptions for its timekeeping and temperature measurement devices. “You’re not gonna do it on your own,” Primex CEO Paul Shekoski said in an interview. “It’s suicide actually.”

Shekoski said he wanted help understanding the process and making sure all the requests were filed correctly. With Michael Best’s guidance, he personally wrote letters to and met with his representatives in Washington.

The collective effort may have made it all the way to the Oval Office. Shekoski said in an email last fall that he heard from his lobbyist at Michael Best, Denise Bode, that Sen. Ron Johnson, R-Wis. cited Primex as an example of a Wisconsin company suffering from tariffs when the senator took the issue to the president. “He not only called USTR, he was able to bring our specific case up to Trump directly,” Shekoski said. Bode did not respond to a request for comment, and a Johnson spokesman did not respond to questions about the Trump contact, saying only that Johnson had advocated for many Wisconsin companies.

Days before this story was published, Shekoski denied knowing whether Johnson brought up the issue with Trump. He said he was just trying to give his elected representatives concrete stories about small businesses struggling with tariffs that they could use to advocate for tariff relief.

Lobbying records show that Primex paid Priebus’ firm, Michael Best Strategies, $85,000 in 2018 and 2019 for its services. “I’m not selling access,” Priebus once told Politico. “I’m merely providing strategic advice and helping them handle their problems.” (Neither Priebus nor the White House responded to requests for comment.)

Primex got mixed results, with about half of its 205 exclusion requests granted and half denied.

Disclosure rules don’t require companies to say how much money they’ve spent lobbying on exclusions specifically. But records compiled by the Center for Responsive Politics show that the number of clients lobbying on tariffs and other trade issues are higher than any year on record. In 2018, the number jumped by 28% to 1,372, and 2019 will significantly exceed that once final figures are in.

"One of the main reasons big finance is able to pull off scam after scam in plain sight relates to the complexity, opacity and esoteric jargon associated with the industry. Repo is a perfect example. The market had a spasm in September and the Fed immediately rushed in with billions to bring the rate down without offering any transparency or a credible explanation of what was going on. Meanwhile, as the crisis continued over subsequent months and the central bank response grew larger and larger, we actually seem to be learning less with each passing day.

Instead of providing the public with the transparency it deserves, Fed officials run around pretending to be financial surgeons called in to perform an unexpected emergency operation on a patient after a freak accident. In reality, central banks are merely pumping billions into an already dead body while enriching connected and powerful individuals and institutions in the process. They know exactly what they’re doing and we need to stop pretending otherwise."...

While I’m grateful to those who’ve spent time trying to thoughtfully explain the mechanics of the repo crisis and why it happened, I think that’s a sideshow at this point since nobody who really knows what’s going on is talking. Instead, we should focus on the absurd and unconscionable lack of transparency with regard to Federal Reserve actions. As far as I know, we have no idea which parties are taking up this expanded central bank funding. Think about how criminally insane that is. We have no idea if it’s driven by a troubled institution like Deutsche Bank, hedge funds with over-leveraged trades, treasury issuance, a combination of these factors, or something else.

We don’t know because they don’t want us to know, and they don’t want us to know because they don’t want the public thinking or talking about it. It’s at times like these when the totalitarian nature of central banking comes into crystal clear focus. What we have is government via unelected, unaccountable bankers. It’s the opposite of self-government, and understanding this simple fact blows apart all the myths about our so-called democracy and freedom. Nothing of the sort exists in reality, and when push comes to shove, you’re just a peasant living in an imperial oligarchy.

This should be the real takeaway from the Fed’s recent actions both in the repo market and via its rapid balance sheet expansion. The public’s not allowed to know anything about what’s really happening, and similar to the post-financial crisis period of a decade ago, the central bank comes in and conducts significant public policy to the tune of hundreds of billions of dollars with zero public debate.

How is it that we’re accepting this? Why isn’t the inequality obsessed left commenting more aggressively on the central bank mechanism of upward wealth transfer, which is precisely what’s been happening for so long? Why push for a wealth tax while leaving the primary instrument of upward wealth transfer (central banking) completely unchecked?

It’d be one thing if the Fed came out and detailed exactly what the problem is and told us specifically who’s using the funds and why. Then we could actually have a conversation about whether this is appropriate or, more likely, a gigantic moral hazard financially rewarding various unscrupulous industry players.

Don’t think for a moment that huge sums of money aren’t being made from these Fed actions. When the spigots come on out of nowhere to the tune of hundreds of billions of dollars someone is benefitting tremendously and it’s not you.

"Eleven years into the loose money recovery, this sucker is finally going down for reasons that have little to do with tight money and everything to do with the inconvenient fact that none of the structural problems have been addressed, much less actually fixed.

We live in a bizarre world dominated by magical-thinking, a world in which the Federal Reserve creating more dollars out of thin air is supposedly the solution to everything, while all the knotty structural problems--unsupportable pensions and entitlements, unsustainable dependence on debt to fund everything from infrastructure to a new iPhone, a sickcare system that is bankrupting the nation, a higher education system that is looting an entire generation for diplomas with marginal market value, a runaway National Security State that burns trillions on unwinnable wars and lies about it--are left untouched because they're, well, difficult, and it's so much easier to say that looser money will solve everything.

Alas, loose money has created a new set of metastasizing problems that will bring this sucker down: widening wealth-income inequality, the only possible result of our system of creating and distributing new money to banks, financiers and corporations; soaring systemic leverage that few see, much less understand; and perhaps most perverse, yet equally unnoticed, loose money has widened the gap between the real economy and the top layer of arcane finance to the point there is literally no connection at all.

The happy story about debt-dependent capitalism is that thriving companies borrow money from our wunnerful banks to invest in new factories, research, software development, etc., hiring millions of top-notch people--top-notch!--at generous salaries to boost productivity and make the entire nation wealthier.

Alas, it's all a fraud. What actually happens is banks "invest" the new money in faster High Frequency Trading (HFT) computers so they can skim even more profit from the rigged "markets." Productivity increase: zero. Social benefits: zero. Economic benefits to the nation at large: zero.

Virtually all the loose money created by the Fed is socially useless financial activity, enriching the few at the top of the wealth-power pyramid who own the financial machinery of repo's, derivatives, FX swaps, leverage, and all the other tricks of the financial trade that has completely disconnected from the real-world economy.

The conventional media constantly hypes the fantasy that trade deals matter, holiday sales matter, employment numbers matter--none of that matters. The big money is made by gaming the financial system, buying regulatory approval, i.e. legalized looting, funneling a few measly millions to craven politicos who have zero understanding of how the nation's financial system actually works, and then running a monstrous skimming operation behind the complexity thickets of "modern" finance, which all boil down to the same toxic concoction that's destroyed economies throughout history:

-- The unlimited greed of those at the top.

-- No real oversight or limits on financial gaming of the system.

-- Abundant central-bank loose money to fund speculative activity in rigged markets.

-- 100% socially useless financial activity.

-- No limits on leverage, so every $1 of financial legerdemain can spawn a $100 dollar bet.

-- Total dependence on debt to fund the government, consumer spending, corporate buy-backs-- everything.

This sucker is going down, and sooner than we think. The Fed can create trillions out of thin air and give it to banks, financiers and corporations, but they can't force them to actually invest in the nation's real economy or even buy the assets the Fed so desperately wants them to buy, i.e. stocks.

The banks and financiers have used the Fed's trillions to enrich themselves for eleven years, and nothing will stop their legalized looting except a collapse of the entire machine. The great karmic irony is they've rigged and gamed the system so rapaciously, absolutely confident there's no end to the loose money, that they've overlooked the increasing fragility of the entire system they've ruthlessly exploited.

Once the contagion starts spreading, loose money won't put the fires out. The idols and false gods (The Fed et al.) will fail most spectacularly, and the karmic fury will not abate until the every last skim and every last con has been consumed."

"Connecticut’s approach to affordable housing creates pockets of poverty, where low-income people are locked out of opportunities that are just around the corner.

Since the mid-1980s, almost $2.2 billion in low-income housing tax credits have been awarded to construct 27,000 affordable housing units in the state. Just 10% were built in prosperous towns, an investigation by The Connecticut Mirror and ProPublica has found. About 80% were located in struggling communities, literally erecting pockets of poverty. The rest fall somewhere in between.

While many state leaders across the country direct those credits to poor areas, arguing that’s where the need is greatest, Connecticut stands out on the national stage. In a recent federal study of 21 states, it had the second highest concentration of affordable housing in high-poverty neighborhoods, behind only Mississippi.

Today, Lugo’s unit is one of more than 700 apartments funded through the tax-credit program within a six-block area of her home. The neighborhood is host to a homeless shelter, a juvenile jail, public housing and a profusion of unoccupied storefronts and apartments plastered with “for rent” signs. On several utility poles are devices that notify police when gunshots are fired. Surveillance cameras abound.

“You know, you don’t have any other option but to try and get used to it and the things around you,” Lugo said. “I just keep to myself with my kids, and we do what we have to do.”

"If you have a good paying job, you should probably try to hold on to it as hard as you can, because those types of jobs are steadily becoming rarer. Since 1990, the U.S. economy has produced millions of jobs, but as you will see below nearly two-thirds of them have been low wage jobs. Of course this is one of the biggest factors causing the systematic erosion of the American middle class. Today, half of all U.S. workers make less than $33,000 a year, but meanwhile the cost of living has been steadily increasing. Housing costs, health insurance and other basic necessities have been rising much faster than our paychecks have, and this has put an enormous amount of financial stress on hard working American families."...

Yes, the U.S. has been creating a lot of jobs in recent years, but meanwhile the overall quality of our jobs has degraded rapidly…

Although the U.S. is on a record streak for job creation, many Americans still feel like they can’t get ahead. It’s not their imagination. The past three decades have seen the economy churn out more and more jobs that offer inadequate pay, a group of researchers found.

“The history of private-sector employment in the U.S. over the past three decades is one of overall degradation in the ability of many American jobs to support households — even those with multiple jobholders,” they wrote.

In fact, if you go back to 1990 about half of all jobs in the U.S. were good jobs.

But since that time, a whopping 63 percent of the jobs that have been created have been “low-wage, low-hour jobs”…

“In 1990, the jobs were pretty much evenly divided,” said Daniel Alpert, a founder of Westwood Capital and one of the creators of the index. In the process of running the numbers, he said, “We discovered that 63% of all jobs that were created since 1990 were low-wage, low-hour jobs. That was a pretty stunning statistic.”

"The prices of the products purchased by the bottom income quintile increased faster than the prices of the products purchased by the top income quintile. As a result, low-income families experienced an annual rate of inflation conservatively estimated at 0.44 percentage points higher than that of high-income families.

Rising wealth and income inequality mean that richer people have ever more disposable income, creating a market incentive for retailers to cater to the needs of lawyers in Chicago and tech analysts in Boston over child-care workers in the Mississippi Delta and part-time retail workers in California’s Central Valley.

More firms catering to well-off consumers means more competition for those consumers means more product innovation and product choice for those consumers, as well as suppressed prices. Fewer firms catering to low-income consumers means less competition for those consumers means less product innovation and product choice for those consumers, and increasing prices.

Accounting for differential changes in prices would bump up the 2018 poverty rate by 8 percent—adding 3.2 million people to the ranks of the officially poor, and 836,000 people to the ranks of those in deep poverty. According to standard government measures, the real household income of the bottom quintile fell 1 percent from 2004 to 2018; using the new, inflation-sensitive accounting, it fell more than 7 percent."

"Income inequality in the U.S. is at its highest level in more than 50 years, according to new Census data. 
The gap between rich and poor is the widest in five states: California, Connecticut, Florida, Louisiana and New York.
Across the U.S., nine states saw a sharp increase in inequality in 2018, including in the Midwest and the South.
Income inequality is worsening across the U.S. even as the economy extends the longest expansion in the country's history. New data from the U.S. Census Bureau show that the gulf between the highest earners and everyone else is the widest it's been in at least 50 years. 

For decades, income growth among higher-earning families in the U.S. has far outpaced that of lower-income households, prompting proposals from some lawmakers to increase taxes on the ultra-rich. The economy has grown for 123 straight months, or just over 10 years. That tops the previous record expansion that lasted from March 1991 to March 2001, according to Natixis. 

"When you have a system where inequality is rising – and where some groups are perpetually overrepresented at the bottom of the income and wealth distribution, even when they follow the standard prescription for realizing the American Dream – it's a recipe for a politically and socially divided nation," said Cornell sociology professor Kim Weeden, director of the school's Center for the Study of Inequality....

In 2018, America's Gini coefficient rose to 0.485 — that is "significantly higher" than its score the previous year, according to the bureau.

Weeden added that the latest Census data don't tell the whole story, noting that wealth — which factors in assets like the value of a home or stock holdings — is even more uneven in the U.S. than income, which for most people comes from their wages and salaries.

"Many of the major economic decisions that middle-class Americans make – whether it's to start a new business or to purchase a home in a neighborhood with well-resourced schools for their children – are more closely tied to wealth than to income," she said.

States with the worst inequality
Around the U.S., income inequality is significantly higher in five states, the Census data show: California, Connecticut, Florida, Louisiana and New York. That gap has been especially visible in places like California and New York, with their sprinklings of tech and Wall Street billionaires, respectively, as well as large populations of poor and homeless people.

"The British Academy is not arguing for an end to profit, but it does hope to “prevent businesses from profiting from harm”, its report said. “This new corporate purpose should be the reason for a corporation’s existence and its starting point. Profit should then be a product of a corporation’s purpose, but not the purpose of the corporation,” it says."

"For nearly two centuries, the Rieckmann family has raised cows for milk in this muddy patch of land in the middle of Wisconsin. Mary and John Rieckmann, who now run the farm and its 45 cows, have seen all manners of ups and downs — droughts, floods, oversupplies of milk that sent prices tumbling. But they’ve never seen a crisis quite like this one.

The Rieckmanns are about $300,000 in debt, and bill collectors are hounding them about the feed bill and a repayment for a used tractor they bought to keep the farm going. But it’s harder than ever to make any money, much less pay the debt, Mary Rieckmann says, in the yellow-wallpapered kitchen of the sagging farmhouse where she lives with her husband, John, and two of their seven children. The Rieckmanns receive about $16 for every 100 pounds of milk they sell, a 40 percent decrease from six years back. There are weeks where the entire milk check goes towards the $2,100 monthly mortgage payment. Two bill collectors have taken out liens against the farm. “What do you do when you you’re up against the wall and you just don’t know which way to turn?” Rieckmann says, as her ancient fridge begins to hum. Mary, 79, and John, 80, had hoped to leave the farm to their two sons, age 55 and 50, who still live with them and run the farm. Now they’re less focused on their legacy than about making it through the week."

In the American imagination, at least, the family farm still exists as it does on holiday greeting cards: as a picturesque, modestly prosperous expanse that wholesomely fills the space between the urban centers where most of us live. But it has been declining for generations, and the closing days of 2019 find small farms pummeled from every side: a trade war, severe weather associated with climate change, tanking commodity prices related to globalization, political polarization, and corporate farming defined not by a silo and a red barn but technology and the efficiencies of scale. It is the worst crisis in decades. Chapter 12 farm bankruptcies were up 12 percent in the Midwest from July of 2018 to June of 2019; they’re up 50 percent in the Northwest. Tens of thousands have simply stopped farming, knowing that reorganization through bankruptcy won’t save them. The nation lost more than 100,000 farms between 2011 and 2018; 12,000 of those between 2017 and 2018 alone.

Farm debt, at $416 billion, is at an all-time high. More than half of all farmers have lost money every year since since 2013, and lost more than $1,644 this year. Farm loan delinquencies are rising.

Suicides in farm communities are happening with alarming frequency. Farmers aren’t the only workers in the American economy being displaced by technology, but when they lose their jobs, they also ejected from their homes and the land that’s been in their family for generations. “It hits you so hard when you feel like you’re the one who is losing the legacy that your great-grandparents started,” said Randy Roecker, a Wisconsin dairy farmer who has struggled with depression and whose neighbor Leon Statz committed suicide last year after financial struggles forced him to sell his 50 dairy cows. Roecker estimates he’s losing $30,000 a month.

Even large companies are facing unprecedented challenges; Dean Foods, a global dairy producer that buys milk from thousands of small farmers, filed for bankruptcy Tuesday, November 12, and is seeking a sale, a move that could further hamper farmers looking for places to sell their milk.

Farmers have always talked of looming disaster, but the duration and severity of the current crisis suggests an alarming and once unthinkable possibility — that independent farming is no longer a viable livelihood. Small farms, defined as those bringing in less than $350,000 a year before expenses, accounted for just a quarter of food production in 2017, down from nearly half in 1991. In the dairy industry, small farms accounted for just 10 percent of production. The disappearance of the small farm would further hasten the decline of rural America, which has been struggling to maintain an economic base for decades.

“Farm and ranch families are facing a great extinction,” says Al Davis, a Nebraska cattle producer and former state senator. “If we lose that rural lifestyle, we have really lost a big part of what made this country great.”

A perfect storm of factors has led to the recent crisis in the farm industry. After boom years in the beginning of the 21st century, prices for commodities like corn, soybeans, milk, and meat started falling in 2013. The reason for these lowered prices are the twin forces upending much of the American economy: technology and globalization. Technology has made farms more efficient than ever before. But economies of scale meant that most of the benefits accrued to corporate farmers, who built up huge holdings as smaller farmers sold out. Even as four million farms disappeared in the United States between 1948 and 2015, total farm output more than doubled. Globalization brought more farmers into the international market for crops, flooding the market with soybeans and corn and cattle and milk, and with increased supply comes lower prices. Global food production has increased 30 percent over the last decade, according to John Newton, the chief economist of the American Farm Bureau. If that’s a good thing for feeding the planet, it also reduces what comes back to producers, whose costs don’t fall with prices.

President Trump’s trade war hasn’t helped matters. After the United States slapped tariffs on Chinese goods including steel and aluminum last year, China retaliated with 25 percent tariffs on agricultural imports from the U.S.. China then turned to other countries such as Brazil to replace American soybeans and corn. “This was a market that took years to develop,” says Barb Kalbach, a fourth- generation corn and soybean farmer in Iowa, referring to China. “The president has worked very hard to make our markets unstable.” Her soybeans are harvested and sitting in a grain elevator as she waits to see if China will buy despite the tariffs. Agricultural exports between January and August this year were down 5 percent, or $5.6 billion dollars, from the same period last year. The Trump administration has made $16 billion in aid available to farmers affected by the trade war, though small farmers complain the bulk of the money has gone to huge producers with large crop losses. Around 40 percent of the $88 billion in farm income expected this year is going to come in the form of federal aid and insurance, according to the American Farm Bureau Federation. Farm income absent that assistance, at $55 billion, is down 14 percent since last year and is half of what it was in 2013.

Smaller farms have found it especially hard to adapt to these changes, which they blame on government policy and a lack of antitrust enforcement. The government is on the side of big farms, they say, and is ambivalent about whether small farms can succeed. “Get big or get out,” Earl Butz, Nixon’s secretary of agriculture, infamously told farmers in the 1970s. It’s a sentiment that Sonny Perdue, the agriculture secretary under President Trump, echoed recently. “In America, the big get bigger and the small go out,” Perdue said, at the World Dairy Expo in Wisconsin in October. The number of farms with more than 2,000 acres nearly doubled between 1987 and 2012, according to USDA data. The number of farms with 200 to 999 acres fell over that time period by 44 percent.

Many small American farmers are routinely selling their crops for less than it costs to produce them. “It’s very intimidating, you work hard every day, and every day, it seems like you’re just always struggling,” says Rieckmann.

Prices are so low that farmers like the Rieckmanns are trying to figure out other ways to come up with the money to keep their farm going. But like many other rural areas around the country, their town of Fremont does not have a bustling economy. Both a Kmart and another department store, Shopko, closed in Waupaca county this year, costing dozens of workers their jobs. Mary Rieckmann who will turn 80 in January, got a job delivering newspapers; the family also launched a GoFundMe account. But after Mary crashed her car on a foggy night, her husband and sons convinced her to abandon her paper route. In the past, the family has sold calves to raise extra money, but John recently brought two calves to the stock market and got $20 for one and $30 for another—two years ago, those calves would have brought in $300 to $400 each. “If somebody would have told me 20 years ago what it was going to be like now, I think I would have called him a liar,” Rieckmann says.

"Food prices are climbing fast in the world’s biggest emerging markets, posing a possible inflation threat after months of dormant pressures.

Asia’s two largest developing economies face a price surge for staple products — pork in China and onions in India — that are central to consumers’ diets. In Turkey and Nigeria, supply problems are driving up costs, while United Nations data show global food prices rose at the fastest pace in October in more than two years.

While the spike is painful for poorer consumers, it hasn’t reached a level to convince central banks to pull the brake on policy easing, as they remain focused on boosting economic growth amid a global slowdown. Average inflation across emerging markets is still at an all-time low, according to a Bloomberg gauge of consumer price indexes."...

Nomura Holdings Inc. economists recently warned of three potential triggers of higher food costs — weather-related shocks, higher oil prices and a sharp depreciation in the dollar — saying emerging and frontier markets are most at risk since food costs make up a larger portion of their consumers’ income.

The key will be whether the increases begin to feed into consumers’ longer-term inflation expectations, which could drive up wages and core inflation in a spiral, said Sonal Varma, Nomura’s chief economist for India and Asia ex-Japan.

"Homelessness, hunger and shame: poverty is rampant in the richest country in the world. Over 40 million people in the United States live below the poverty line, twice as many as it was fifty years ago. It can happen very quickly.


Many people in the United States fall through the social safety net. In the structurally weak mining region of the Appalachians, it has become almost normal for people to go shopping with food stamps. And those who lose their home often have no choice but to live in a car. There are so many homeless people in Los Angeles that relief organizations have started to build small wooden huts to provide them with a roof over their heads. The number of homeless children has also risen dramatically, reaching 1.5 million, three times more than during the Great Depression the 1930s. A documentary about the fate of the poor in the United States today."

"Back in 1989, when boomers were between 25 and 43, they already owned 20.9% of the country’s wealth, according to data from the Federal Reserve updated earlier this month. In 2019, millennials are between 23 and 38, and they currently own a whopping 3.2% of wealth. That means boomers had more than six times as much wealth in 1989 as millennials do now."

"Just eight super-rich men hold the same amount of wealth as the poorest half of the world’s population, according to an analysis from the charity Oxfam released Sunday night. 

Six of these billionaires, from Forbes’ list of the world’s richest people, are American entrepreneurs: Microsoft co-founder Bill Gates, Berkshire Hathaway chairman and CEO Warren Buffett, Amazon founder and CEO Jeff Bezos, Oracle co-founder Larry Ellison, former New York Mayor Michael Bloomberg and Facebook founder and CEO Mark Zuckerberg. Rounding out the list are Carlos Slim, the Mexican tycoon, and Amancio Ortega, the Spanish founder of a retail conglomerate that includes clothing chain Zara. Together their net wealth ― assets minus debts ― amounts to $426 billion.

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We cannot name the bottom half of humanity, more than 3.6 billion people, with that kind of precision, but they mostly live in the developing world.

The Oxfam statistic is one of the starkest ways to portray the disturbing rise of economic inequality, which can be a hard concept to grasp when portrayed in percentages and billion-dollar denominations. The global anti-poverty group has been tracking inequality since 2014.

Worsening inequality threatens to upend the very fabric that’s held democracies together in the post-World War II global order. In the United States, the widening gulf between the rich and everyone else helped propel Donald Trump into office. Overseas, the trend is credited with sparking Brexit, the U.K.’s vote to leave the European Union.

“Left unchecked, growing inequality threatens to pull our societies apart,” Oxfam writes in its report, citing Brexit, Trump’s campaign and “a worrying rise in racism and the widespread disillusionment with mainstream politics.”

In 2016, the richest 1 percent of the world held slightly more than half of the wealth of the entire planet, Oxfam notes. And the 1,810 billionaires on Forbes’s list ― 89 percent male ― hold $6.5 trillion, as much wealth as 70 percent of humanity.

Put another way, billions of people are fighting over crumbs from half of a pie, while the rich dig into fat slices all to themselves.

For its analysis, Oxfam used Forbes’ ranking of global billionaires and wealth data from Credit Suisse. According to the wealth data, 80 percent of the bottom half of the world’s population are adults living in Africa and India. They’re younger and more likely to be single and poorly educated. Women who are poorly educated are even more likely to have very little wealth.

Growing inequality threatens to upend the very fabric that’s held democracies together in the post-World War II global order.
A very small sliver of the bottom half live in the United States, mainly because the wealth data looks at net wealth, subtracting the amount of debt a person has from assets. That means, for example, that young adults in the U.S. who have a big mortgage and maybe a car loan and a student loan will, on paper, seem poor.

Some economics writers, Felix Salmon of Fusion most prominently, have used this point to discount Oxfam’s report. It’s a fair criticism, Gawain Kripke, Oxfam’s director of policy and research, told The Huffington Post. But it’s a footnote, not a reason to dismiss the disturbing findings of the report, Kripke said.

If you ignore debt entirely, it would take 56 of the wealthiest individuals to equal the wealth of the bottom 50 percent, according to Oxfam’s report.

“The underlying trend is the same: At the very pinnacle of the economic pyramid, rich people are getting progressively and rapidly richer, while the rest of humanity is muddling along,” Kripke said. He called the wealth of the top eight individuals “biblical.”"