This column highlights the top economic stories of the week.

There is no gold left in California. Governor Arnold Schwarzenegger is threatening to layoff fire, police, and teachers. All of this is certain to further  increase unemployment and foreclosure rates. Schwarzenegger is now considering releasing nonviolent prisoners, shortening the school year, legalizing and taxing marijuana. Fred provides a unique perspective on the sorry state of California.

The Economist says that in America and Europe, new rules relating to the banking sector overhaul are facing stiff resistance , mostly from regulators themselves.

Tim Geithner plans to unveil a comprehensive regulatory overhaul by mid-June. The European Commission on the other hand, unveiled a blueprint for reform of financial supervision. It will create two new institutions aim to correct a fundamental flaw in European bank regulation and supervision; namely, that although banks are free to operate across borders, they are supervised only by their home countries.

And as GM, the nation’s largest automaker and for decades an icon of American manufacturing, teeters on the brink of bankruptcy and a de facto government takeover, President Obama prepares to address the nation at 11:30 a.m. ET on Monday to explain the rationale for the filing and his hopes that this is the best route for a turnaround. It’s the end of America’s great auto era.

Meanwhile on the renewable energy front, a new study from Greenpeace, the European Solar Thermal Agency, and the International Energy Agency’s SolarPACES Group has shown that concentrated solar power (CSP) could generate a quarter of the world’s energy needs by 2050–and create thousands of new jobs and prevent millions of tons of CO2 from being released. But, while basic renewable energy research is being conducted at numerous institutions around the world and much of this technology remains trapped in labs for want of commercialization know-how and funding. 

So, while the worl economy continues to paint a dark picture, Bill Maher throws shares humor by highlighting his “new rules” for America covering everything from the disappearance of bees, greed and health care, to climate change, war profiteering and Ronald Reagan. Enjoy!

Transcript of President Obama’s address from Saturday, February 21, 2009:

THE PRESIDENT:  “Earlier this week, I signed into law the American Recovery and Reinvestment Act — the most sweeping economic recovery plan in history.  Because of this plan, 3.5 million Americans will now go to work doing the work that America needs done.

I’m grateful to Congress, governors and mayors across the country, and to all of you whose support made this critical step possible.

Because of what we did together, there will now be shovels in the ground, cranes in the air, and workers rebuilding our crumbling roads and bridges, and repairing our faulty levees and dams.

Because of what we did, companies — large and small — that produce renewable energy can now apply for loan guarantees and tax credits and find ways to grow, instead of laying people off; and families can lower their energy bills by weatherizing their homes.

Because of what we did, our children can now graduate from 21st century schools and millions more can do what was unaffordable just last week — and get their college degree.

Because of what we did, lives will be saved and health care costs will be cut with new computerized medical records.

Because of what we did, there will now be police on the beat, firefighters on the job, and teachers preparing lesson plans who thought they would not be able to continue pursuing their critical missions.  And ensure that all of this is done with an unprecedented level of transparency and accountability, I have assigned a team of managers to make sure that precious tax dollars are invested wisely and well.

Because of what we did, 95 percent of all working families will get a tax cut — in keeping with a promise I made on the campaign.  And I’m pleased to announce that this morning, the Treasury Department began directing employers to reduce the amount of taxes withheld from paychecks — meaning that by April 1st, a typical family will begin taking home at least $65 more every month.  Never before in our history has a tax cut taken effect faster or gone to so many hardworking Americans.

But as important as it was that I was able to sign this plan into law, it is only a first step on the road to economic recovery.  And we can’t fail to complete the journey.  That will require stemming the spread of foreclosures and falling home values, and doing all we can to help responsible homeowners stay in their homes, which is exactly what the housing plan I announced last week will help us do.

It will require stabilizing and repairing our banking system, and getting credit flowing again to families and businesses.  It will require reforming the broken regulatory system that made this crisis possible, and recognizing that it’s only by setting and enforcing 21st century rules of the road that we can build a thriving economy.

And it will require doing all we can to get exploding deficits under control as our economy begins to recover.  That work begins on Monday, when I will convene a fiscal summit of independent experts and unions, advocacy groups and members of Congress, to discuss how we can cut the trillion-dollar deficit that we’ve inherited.  On Tuesday, I will speak to the nation about our urgent national priorities.  And on Thursday, I’ll release a budget that’s sober in its assessments, honest in its accounting, and lays out in detail my strategy for investing in what we need, cutting what we don’t, and restoring fiscal discipline.

No single piece of this broad economic recovery can, by itself, meet the demands that have been placed on us.  We can’t help people find work or pay their bills unless we unlock credit for families and businesses.  We can’t solve our housing crisis unless we help people find work so that they can make payments on their homes.  We can’t produce shared prosperity without firm rules of the road, and we can’t generate sustained growth without getting our deficits under control.  In short, we cannot successfully address any of our problems without addressing them all.  And that is exactly what the strategy we are pursuing is designed to do.

None of this will be easy.  The road ahead will be long and full of hazards.  But I am confident that we, as a people, have the strength and wisdom to carry out this strategy and overcome this crisis.  And if we do, our economy — and our country — will be better and stronger for it.”

Thank you.

]]> http://redgreenandblue.org/2009/02/21/obamas-weekly-video-address-the-american-recovery-and-reinvestment-act/feed/ http://sustainablog.org/2008/11/19/dont-worry-be-happy-surviving-the-financial-crisis/ http://sustainablog.org/2008/11/19/dont-worry-be-happy-surviving-the-financial-crisis/#comments Thu, 20 Nov 2008 04:12:42 +0000 John Ivanko http://sustainablog.org/2008/11/19/dont-worry-be-happy-surviving-the-financial-crisis/ Are you surviving the financial crisis?

While the mainstream media seem more interested in spinning stories of foreclosures, bankruptcies and the like, millions of Americans who have gone green in either their homes, lifestyles or businesses have discovered a degree of sustained prosperity, security and stability, despite the tough times both nationally and globally. That’s not to say they’re living high on the land. But that’s the whole point for many who have chosen to live lean, green, and with the health of their community in mind, focusing on what they value, not on what they can consume next.

There’s Tazza D’oro, the fair trade and community-focused coffee house I just visited in Pittsburgh, where sales are up by double digits; this, despite the restaurant industry as a whole seeing sales plummet by about 43 percent last I checked with the National Restaurant Association. New Society Publishers, the publisher of my latest books ECOpreneuring and Rural Renaissance, both printed on 100 percent post consumer waste recycled paper, continues to prosper, perhaps even more so with books that provide positive solutions for people hungry to make a difference. For people who took their early summer 2008 Economic Stimulus Package check and invested it in energy efficiency and conservation, paid off a credit card balance, or like my wife and I, added a photovoltaic system to power our all-electric CitiCar, we realized both a return on our investment and return on environment while needing less money to pay the bankers or utility companies.

Here’s what I’ve learned from both personal experience over the past twelve years and in talking with many others about how to survive a financial crisis:

(1) Invest in the future and in your community

In a time when 401ks are quickly turning into 101ks, many Americans are exiting the debt-based economy, paying off credit cards, canceling car loans, paying down mortgages. Suddenly, when we don’t need to earn money to pay the banks, we rediscover what freedom means. We don’t save for the future, we invest in the one we want to live in, filled with green building materials, fairly traded products, and crafted as a part of the restoration and reuse, place-based economy, sometimes costing us only pennies on the dollar. From an old building turned we into a strawbale greenhouse heated by solar thermal system and biodiesel (we make with a neighbor) to various renewable energy systems, we are pleased — happy — that what we invest in does, in fact, make the world just a little better.

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Economic Populism appears to be back in vogue. Given the fall of Lehman Brothers and the Wall Street machine, the economic banter clearly seems to be “the people” versus “the elites.

Economic populism involves an economic philosophy urging social and political system changes. In the current political and economic climate, the public concern over the inequity of wealth appears to be at a peak. There is a growing call by Senator Barack Obama and democrats to raise taxes on the wealthy to shrink the wealth gap. But is it true that the rich are getting richer? Or are the rich actually in danger of losing a significant portion of the nation’s wealth? Are the democrats worried about a problem that’s already being fixed by the markets?

Emmanuel Saez, the income-share expert and economics professor at the University of California, Berkeley told Robert Frank of the Wall Street Journal that during the Great Depression, the income and wealth of the top 1% of society fell drastically. (Read here for the full story). If history is to be believed then this will happen again especially if Obama becomes president.

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Their answer:

A: Why not? Sure, certain overpriced organic nice-to-haves will suffer, but we’ll most likely see a surge in what we’ve dubbed ECO-CHEAP: cash-strapped consumers going out of their way to save money on energy bills, motorized transport and other waste-prone, eco-unfriendly activities. While the environment may not be their first concern, there will be less polluting nevertheless.

So, what’s the take away for eco-entrepreneurs? To weather the current financial storm, position your products and services as providing the core consumer benefits of cost savings, waste elimination and improved efficiencies. People are looking for hip ways to save money.  Combine this with another trend cited by Trendwatching.com, NO-FRILLS CHIC: well-designed yet affordable products and services, and you can have a solid strategy for these volatile times. All said, appealing to the eco-cheap with well designed, affordable products and services makes a lot of sense.

Photo: Trendwatching.com

In a recent Op-Piece in the New York Times, Mr. Buffett explains his reasons for investing in US Equities and urges others to do the same.  He encourages investors to “be fearful when others are greedy, and be greedy when others are fearful.”  Warren may be speaking from the perspective of a patriot, but he is also a pretty darn savvy investor, consistently ranking among the richest people in the world.  He acknowledges that “people have a right to be wary of highly leveraged entities or businesses in weak competitive positions.  But fears regarding the long-term prosperity of the nation’s many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records 5, 10 and 20 years from now.”

If Warren’s betting on the US Economy, deal me in. 

Check out the rest of the article, on top of being an incredible investor, he is also a witty writer.  It is well worth the read. 

Photo Credit: By Photo Credit: One Trick Pony in FlickR’s via Flickr’s Media Commons

Photo credits: Wired.com.

Entrepreuneur.com recently wrote an excellent guide for small business owners on proactive moves they can take to survive - and better yet, thrive - in the nose-diving economy.

“You Can Weather the Economic Storm (Product price sensitivity and financial creativity can help you thrive in any economy)” is especially relevant for green entrepreneurs as many of the principles underlying Dennis Romero’s advice aligns with what sustainable business leaders already know: go for local resilience, understand the value of community-based goodwill and when in doubt, simply, simplify, simplify to the bare essentials (do the latest farm-fresh food recipes or eco-cleaning supplies mantras sound familiar, anyone?).

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Thank you getthebigpicture.net. Video source: MBelinkie on YouTube

The event, which is being held at the Sheraton New York to coincide with the opening of the UN General Assembly, was already the site of impressive amounts of security - for Heads of State and foreign dignitaries - saw several additional steps taken in and around the Sheraton New York to protect Republican Senator McCain and his entourage. McCain’s entourage included Alaska Governor Sarah Palin, but not surprisingly, neither Senator McCain nor Governor Palin were made available to the press for questions.

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I can’t wrap my head around all the pieces yet (and I’m not sure if I’ll ever be able to), but here are some random thoughts about what the market meltdown might mean for oil prices, oil production, renewable energy development and climate change:

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Investment Banks have long been the entrepreneurs of Wall Street. Sure they take risk but then look at the return that they bring. In a capitalistic society, who doesn’t respect the work of an entrepreneur? Time and again they have been instrumental for fueling the economy. A high return on investment has enabled many of the investment banks to show a solid to commitment to corporate social responsibility in the last few years:

• Lehman Brothers partnered with Spelman College a year ago to create a center for Global Finance and Economic Development at the college to prepare women of African descent for successful careers and leadership in the corporate world.
• Morgan Stanley announced last year the creation of the Morgan Stanley Carbon Bank to assist clients seeking to become carbon neutral.
• Goldman Sachs has just announced 10,000 women, a series of non-profit and academic partnerships that provide business an d management education to women in Brazil, India, China and the Philippines.

There has been much question about the Fed refusing to bail Lehman out for a paltry amount in comparison to what it was willing to pay to bail out AIG. Although their claim is that it is not socially responsible to bail out an investment bank with taxpayer dollars, the larger questions lies in that is it socially responsible for the Fed to allow the entrepreneurs of Wall Street to fail when they are actually working to serve society by demonstrating commitment to CSR?

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In view of the current financial crisis, it is hard to grasp the fact that overnight investment banks once regarded the kings of Wall Street, are teetering on the edge of stability. The bankruptcy of Lehman Brothers has threatened the survival of Morgan Stanley in spite of the fact that it has just declared great earnings. All eyes are on Morgan and Goldman Sachs, the two big I-banks left standing. Will they go next? What will this mean for corporate social responsibility in the investment banking sector?

Investment Banks have long been the entrepreneurs of Wall Street. Sure they take risk but then look at the return that they bring. In a capitalistic society, who doesn’t respect the work of an entrepreneur? Time and again they have been instrumental for fueling the economy. A high return on investment has enabled many of the investment banks to show a solid to commitment to corporate social responsibility in the last few years.

>>Read the rest of this post at The Inspired Economist