The Republican rhetoric about President Obama and the private sector is so common, it no longer surprises: the White House has an "anti-business" agenda, the argument goes, which undermines private enterprise.
And yet, we continue to see new evidence all the time that Obama is the Worst Socialist Ever. The New York Times reported yesterday, "United States corporate profits reached a record high in the third quarter of this year, even adjusted for inflation, according to a report from the Bureau of Economic Analysis." Here it is in chart form:
You'll notice in this image, published by the Federal Reserve Bank of St. Louis, that post-tax corporate profits collapsed when the economy crashed in 2008, but then sharply improved after Obama became president, reaching their highest point ever this fall.
It's against this backdrop that the right still complains bitterly that the president is a radical socialist who says mean things about "job creators." To ask slightly more of those enjoying record profits, Obama's detractors argue, is an outrage. Indeed, many of the business leaders who've benefited under the status quo invested heavily to defeat the president -- ostensibly because they've been so dissatisfied with the status quo.
Increasingly, their cries are literally unbelievable.
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the golden eggs aren't big enfough!!! Kill the goose!!!
The real cage match spectacle is not the fit of distraction the DC media has worked itself up on over McCain vs. Rice, or Boehner vs reality. It's the one between the the 1% and the middle class.
And we are getting our teeth kicked out day after day, decade after decade. And we are going down slow while the parasites win. That's what the real story of America's decline is. Not the line that goes down temporarily in each recession. It's the line of the overall decline of middle class wages over the last 30 years.
The reason why it does not make good news?
You'll notice that the chart didn't say where those profits were made. More importantly, if they were made overseas, they'll stay overseas.
Are you all familiar with the phrase "going Galt"?
So how about the foreign companies earning money here, but pay little to no taxes?
Nice try but no dice. The other metric you can check to measure these things are the levels of CEO compensation (unless of course you are defending companies that are "struggling" paying their officers massive salaries, bonuses, and stock options, which wouldn't worth much in that case).
Shooter you always ask me what I want from these people. Ok if they are as important to the economy as they like to pretend then where are the jobs? Why don't they just wave thier magic ecconomy wand and make things better? Why didn't they do it 6 months ago? 9 months ago?
Bueller?
After the Bush tax cuts, corporate profit after tax went from "robust" to "obscene." You will notice that not even the Great Recession knocked profits back down to the Clinton era.
Yes, the Clinton era, when unemployment was low, profits were good, and the Federal budget was balanced.
Obscene corporate profits make the rich richer. Yes, yes, we all have our 401k money in the stock exchange. But the holdings of the middle class do not make up for the wage erosion of the last 12 years.
Blankman, I didn't realize that in addition to being a wrong rightie, you were an Ayn Rand acolyte....Now I get it....So how many jobs have you created, again?
Crickets, that's what I thought!
So the U S DEPT OF COMMERCE is tracking the profits of french corporations , by the tax returns on taxes paid to the french government ? ..... Why would any corporation pay american taxes , if they did not make their profits via america ?
No wonder conservative economic policies are FAIL FAIL FAIL
Oh, Blanks, you are such a child. Most of us read Ayn Rand when we were young and her stories satisfied a great need in our lives and encouraged dreams of what our place might be in the world. I loved her books....until I grew up. Then I began to understand that the world is all interconnected and her take on it was so small minded that I began to suspect the stories of her great intelligence were really fabricated to sell books.
You just can't do it, can you folks? You just have to give it the attention it needs. And how could you have not known of the Randian core of this sad creature? Jeez...
Any person or company "going Galt" would only be hurting themselves in the long run. Imagine a company in a competitive industry telling its shareholders it is going to willingly lose market share, by reducing output, as a means of some sort of social protest. The shareholders wouldn't stand for it and in the case of a privately owned company, they would be shooting themselves in the foot - another company will swoop in and pick up the slack.
Although I agree with you in principle.... If it continues the way it is going, with no jobs, a shrinking middle class, more and more people hitting bottom, the profits from the corporations will flat line because nobody will be able to purchase the products they create. For the companies to have the profits they have now simply means they are overcharging for the product. That makes it more difficult to sell the product to the majority of the people that might buy it. It will become a viscious downward spiral if something doesn't change.
"Are you all familiar with the phrase 'going Galt'?"
Go ahead and do it. I dare you.
I think you guys aren't understanding how this all works. Multinationals will make and market overseas. Profits are at a record. The investors are happy. Other countries get the jobs, and the taxes.
It doesn't matter if people here don't have money. People overseas have plenty. In short, the US is becoming superfluous. It's easier to do business in China, and it's market is huge and underserved.
If Obama and the administration want to raise taxes, write hundreds of new rules, and generally make life difficult, fine. Business can take it's money and jobs elsewhere. And you're seeing what happens when they do. Lots of profit, and no jobs for the US.
So given everything, why would the President continue to kowtow to all these corporate folks the way that he does?
Simple. It's because they control Boehner.
The President must deal with Boehner because we ignored the House Races in 2012.
So look in the mirror.
We didn't ignore house races and considering the way the deck is stacked we did (imho) reasonably well. but the trick is going to be what we do in the mid terms, and considering current trends in Tea Party politics they will continue to "extreme" themselves right out of office.
Bull.
Take PA 08. It went for the Dem candidate 57 to 42 in 2008. We lost it 57 to 42 in 2012. But Obama won that district 50 to 48.
Why.
In 2010, a GOP took this seat and did party line votes with Boehner. But he was not made to pay for his votes. Did he "extreme himself out of office?". No. So your statement is nonsense. Ask yourself why this happened- because that will get at the real problems, and guide ourselves to fix them. So what happenned? In a nutshell, in Bucks county, the RNC supported the GOP but D-trip was a no show for Kathy Boockvar- one of the candidates I contributed to.
So, you can dream sweet dreams about election consequences about the GOP, but it simply did not happen in 2012 because Dems weren't focused on the House races. We were told these races were hopeless, from the same mouths that told us that the presidential race was a tossup into the last day of the campaign.
I gave some more info in case you are interested in this post.
My view is that the DCCC head did a respectable job with the resources he had, but his organization is ill suited to the task. We need an OFA for congressional campaigns, run at arms length from the party, run by Dem Progressives. The establishment political consultants are the old guard who must be ignored- we have to use the hammer that hit the nails decisively for the President in 2012.
OFA started organizing Ohio for Obama's re-election in 2008. The time to start the 2014 battle for the House is NOW. This post is a further exposition of what we need to revolutionize House Congressional Campaigns.
This is the message that Fearless Leader always reminds us of: "Don't Agonize. Organize."
You are kind of making my point and I stand by what I said. With all things as they were we didn't do to badly or at least not worse than we could have.
The thing to keep in mind is redistricting. Sure it made the GOP "Safe" for a while but their margins shrank from '10 and it also made it very difficult for them to make any gains. we are still only talking about a 15-20 seat shift and that IS possible.
Mostly what they have when you take the ecconomy away is Social issues and they don't ever do well on that front.
The thing that needs serious attention is State and Local races and that's what we need to remember and focus on.
No, I am not making your point. You said that they would be made to pay for their extremism.
Redistricting? Try again. PA 08's lines did not change significantly, and besides, Obama won there by 2 points. The Dem candidate lost by 7, and the DCCC had $700K to commit but didn't. Why WHy Why. You don't even want to attempt an answer and instead respond to facts with stock DNC talking point responses.
The RNC was there forcefully promoting their candidate, yet we were focusing a billion on other races.
... And now like Captain Renault in Casablanca, we are shocked... Shocked about Boehner's shenanigans, and grouse about the President attempting to pull his strings by pulling the strings of his Corporate handlers.
I retract my statement regarding district lines. My statement was was based on a second hand source I read while researching this race during the campaign. After reviewing the data on the lines, I am unsure if the characterization is fair, because it appears to me that at best the district now has only about 50% of the territory it once had- from PA08 (2001) and PA08 (2012) are the same.(source) It may well be that the original gloss I read was accurate, and the redistricting was not significant because the changed area did not introduce more GOP voters, but I have not researched that so I can't say whether that it might be true on that basis.
Nonetheless. The point remains that Obama carried this district, but the dem candidate was slaughtered by a concerted attacked by the RNC. The traditional approach of Dems in this district was an utter fiasco.
We can do better with an OFA style approach, but it must be divorced from the control of traditional political operatives in the DNC. It's not enough to wave your hand and utter platitudes about paying serious attention to state and local races. The "grassroots" meme of the DNC is tired. We need real organizing- never mind whose feather's get ruffled, or whose territory is being invaded, or what the big DNC corporate donors say.
And these greedy people actually have convinced themselves that they are patriots! Frankly they're vultures devouring everything for their own bottom line, even as their employees salaries have flat-lined, the nerve! Tax them, tax them heavily!
It would be great to see this graph normalized by something like the gross domestic product (GDP) instead of just adjusted for inflation.
So, just a thought! With a do nothing Congress, a president who complains Congress won't pass his "job creating" bills, record profits without stimulus, do we really need the govt to do anything? Maybe we are in a new normal where corporations make money without relying on labor in this country. Perhaps we are witnessing the effects of a global economy.
do we really need the govt to do anything?
Shall we start by burning the constitution mr patriot?
He does have a point. The global value of Chinese "Slave Labor" has been to suppress wages and destabilize National manufacturing (and thereby the influence of organized labor) in the west.
As for what we need the Government to "Do" It's a matter how you define "Do"
There is: "Can do", "is willing to do", and "will do". which are definitely NOT all the same things
As far as the govt doing anything, I was merely saying regarding the economy. The govt needs to uphold the Constitution. For the economy, I believe we are in a structural transition where low skill jobs are being off shored. Those that remain will be in sectors that can't be outsourced, i.e., retail, food service, etc. High skill jobs will continue in demand, but some relocation of the work force may be needed
These are net profit numbers. For most businesses that means after most forms of executive compensation. The numbers represent what should be available to pay to shareholders in dividends, to buy back stock or to invest in new business. They are truely astounding.
i am employed in a low-level retail position, and I can tell you that prices have gone up significantly in the past few months. We repriced pretty much the entire store since August, and some items went up 30 - 40%. I've noticed grocery prices are climbing as well. Don't ask me where the extra $ is going; certainly not into my meager paycheck. Rising prices are a factor in the increasing business profits when a consumer has to pay more money for the same amount of goods (or less).
I've noticed how prices may not rise on a 'package' of something (like sugar), but the package size has decreased (what was a 5-lb bag is now a 4-lb bag). That's another sneaky way to increase profits (mostly for the middle-men in the supply chain).
But not equity compensation. Which is the majority form now, in large part thanks to tax laws sheltering it from taxation.
There's a reason that profits are skyrocketing but 401(k) accounts are stagnant.
Dup
And yet, we continue to see new evidence all the time that Obama is the Worst Socialist Ever.
Yeah, he is a terrible socialist He can't even get that right. Even a marginal socialist would have seized all those "Obscene Profits" in his first term. BWAHAHAHAHA!!!!!!!
Does no one see the problem here?
"Additionally, all of the growth in domestic corporate profits was accounted for by the financial sector.
Domestic profits of financial corporations rose $71.3 billion in the third quarter, after falling $39.7 billion in the second. Domestic profits of nonfinancial corporations, on the other hand, decreased $1 billion in the third quarter, after rising $27.8 billion in the second quarter."
Bankers are getting richer, no one else.
While this does fly n the face of the "Socialist" charges, it is not a particular positive that ALL increase in profits is from the financial sector.
Right the really wealthy got more rich. while cutting jobs and telling everyone else they were just not rich enough to hire or keep jobs in America due to the low taxes they already enjoy and the only option for the American people was to give them even more of the pie.
much fun GOP. thank you for your leadership that has lead us here in the first place.
Taxes need to go up on the rich including closing tax shelters in the Cayman Islands. Loopholes in the tax code need to be shut down that the wealthy and corporations use to escape taxation. Capital gains should be raised to at least 39% where the Clinton rates for income taxes will go up for the wealthy after January 1st. The tax burden is the lowest, at about 15% GDP, that its been since the 1950's. We need substantial tax revenues raised because the richest 400 American families own more than the bottom 150 million Americans combined. We live in a new gilded age of corporate plutocrats that run our country for themselves. President Obama needs to hold firm and let the country go over the fiscal cliff letting the Bush tax cuts expire completely. Anything less than this by Democrats is treason for our kids and their economic future. Wealth inequality like we have in this country makes America a plutocracy that threatens the very foundation of our democracy. Going over the fiscal cliff is the first battle in a long war against entrenched corporate special interests that threaten to destroy our democracy if they are left unchecked.
One last thing: we need to get Senator Elizabeth Warren on the Senate Banking Committee so the largest Wall Street banks can get broken up in federal court with antitrust legal actions. The "too big to fail" banks on Wall Street are up to their usual speculative games again and more bailouts will happen again if strong actions are not taken against them. These actions would solidify President Obama as one of our greatest Presidents if he goes after the Big Wall Street banks that must be broken up if we are to escape more rounds of bailouts in the future.
Our 4 biggest banks have 576 trillion dollars worth of derivative contracts. Yet they only have 13 trillion in assests. All it will take is one big loss and one of these 4 will fail, wiping out what little is left in the FDIC, and America will be literally broke. We need to go back to serious banking reform. Any organization that is financially backed by the Government, should have serious regulations on how they invest their money.
We also need to make laws that Government money, (grants, supply contracts, etc.) cannot go to any Business that pays excessive amounts to any executives. ( Excessive pay, would be considered bonuses of more then 3 times their annual pay).
Right now Corporations are making more then before the crash, and paying less. Tax breaks are supposed to be given to encourage Businesses to do something. Right now we are giving them blindly in hopes that someday, maybe, if they feel like it, someday maybe Businesses will hire more people. BUSINESSES WILL NEVER HIRE MORE PEOPLE THEN THEY NEED!!! Trickle down economics is a myth started by President Reagan, and pushed by George Bush on the American public. It hasn't worked in over 30 years, and it never will. It has cost the American Federal Government over 20 trillion dollars. We need to get rid of the bush tax cuts, and start taxing money made overseas. We need to discourage money, and jobs going overseas, and encourage money and jobs in America.
My company is making record profits, but my paycheck has not gone up at all. Damn you, Obama!!
/snark (in case you couldn't tell)
Barack Obama. Worst. Socialist. Ever.
Corporate profits increasing exponentially in the global economy.
I agree with the GOP, Obama is the worst (socalist!) president in the history of the world
They just don't combine the two in the same sentence.
It would be more interesting to see this corrected for inflation (i.e., real profits as opposed to nominal).
That said, Kevin Goebbert has an interesting idea, once we've seen that data: show corporate profits as a ratio against GDP. If they're capturing more, that ratio will rise, even as GDP rises per capita....
Good morning Rachel,
I am reading your posts and again thank you for your excellent honest work! Have a great and safe week-end.
Proving once again, Socialism is only good when it is being used for the rich and not for the poor.
It is irresponsible to put that chart, which is NOT inflation adjusted, right under a quote about how profits are at an all-time high "even adjusted for inflation".
i believe the GOP does this as part of a Starve The Beast Strategy. That is, the attempt to destroy government so they can say. Help! Help! we don't have enough money to pay for SS & Medicare. That's certainly Paul Ryan's game.
How did all thes economists and college professors get on my facebook site?