In the context of deepening economic decline, Richard Wolff analyzes and attempts to answer these questions:
What were the causes and the results of the recent political theater focused on raising the US debt ceiling? What does the "deal" between President Obama and the Republicans mean economically and politically? What are the alternatives that Congress never explored? What can and should now be done, economically and politically?
Appeared originally in The Guardian on August 22nd, 2011
In the US, as in the UK, public sector unions are facing cuts to their wages, pensions and benefits to pay for budget cuts. Photograph: Sang Tan/AP
Last week, Democratic governors in New York and Connecticut repeated the austerity politics of Greece's Prime Minister Pappandreou and Portugal's former Prime Minister Socrates. In doing so, they likewise imitated the austerity politics of their Republican and Democratic counterparts across virtually all 50 states.
Standard and Poor’s downgrades US debt, stock markets gyrate around the world, Sarkozy and Merkel perform yet another empty summit, the Chinese and Japanese economies look worrisome. Serious commentators worry about global recession, another global banking collapse, eurozone dissolution, and austerity programs that only make matters worse. Nouriel Roubini, famed Professor at NYU’s Stern School of Business asks this month, “Is Capitalism Doomed?” His answer: maybe.
Richard Wolff joins Thom Hartmann on The Big Picture to discuss the recent downgrading by Standard and Poor's and the resulting plummet in the stock market (634 points) that occurred soon after - the largest one-day loss since the financial crisis began in 2008.