Morning Must Reads: Nation of Inequality, Keynes Was Right? & Lancaster's Dirty Air

The Pittsburgh Post-Gazette has an editorial this morning highlighting the "festering problem" of exorbitant CEO pay.

In 2011 the average CEO pay of companies in the S&P 500 Index jumped 13.9 percent to $12.94 million, while the average worker pay rose 2.8 percent to $34,053. This yawning gap is the largest in the world, according to the latest AFL-CIO Executive Paywatch, but it wasn't always this way.

Scarcely three decades ago, U.S. corporate CEOs were paid 42 times the salary of the average worker — a hefty enough differential, but one that is puny by today's standards. 

As Post-Gazette business reporter Ann Belser reported Friday, an average worker would have to toil for 11,100 years to make as much as Apple CEO Timothy Cook. With an annual pay package of $378 million, Mr. Cook makes in 2 hours and 12 minutes what the president of the United States makes in a year.

It is official: in a period of high unemployment, large cuts in public-sector spending SLOW rather than GROW the economy. Case in point: the UK economy just re-entered a recession.

Paul Krugman grimly notes we told you so! Before you go all, in your face limey, remember Pennsylvania's economy in 2011 grew more slowly than it should have because of a combination of federal, state and local budget cuts that led to the loss of tens of thousands of jobs. Austerians or people who wrongly claim that budget cuts grow the economy — people like the Prime Minister of the United Kingdom, Pennsylvania Senator Pat Toomey and Pennsylvania Governor Tom Corbett — have imposed additional years of needless unemployment on thousands of people. Elections, it seems, do have consequences.

It’s Official: Keynes Was Right, says Henry Blodget. Recent election results in Europe seem to have raised consciousness in a way literally years of economic data couldn’t: the austerity doctrine that has ruled European policy is a big fat failure.

I could have told you that would happen, and sure enough, I did. Did I mention that after three years of dire warnings that the bond vigilantes are attacking, the interest rate on US 10-years remains below 2 percent?

It’s important to understand that what we’re seeing isn’t a failure of orthodox economics. Standard economics in this case — that is, economics based on what the profession has learned these past three generations, and for that matter on most textbooks — was the Keynesian position. The austerity thing was just invented out of thin air and a few dubious historical examples to serve the prejudices of the elite.

And now the results are in: Keynesians have been completely right, Austerians utterly wrong — at vast human cost.

If you live in Lancaster County, remember the following story on air pollution next time you hear a local member of the business lobby complain about efforts to improve air quality.

Lancaster County continues to be one of the nation's 40 most-polluted metropolitan areas in smog and soot, according to the American Lung Association.

The ALA's 13th annual State of the Air report ranks the Lancaster Metropolitan Area as having the 29th-worst smog, the 39th-worst bad-air days for short-term soot and the 32nd-worst annual soot pollution.

The smog and short-term soot bad-air days here worsened from last year's report. However, annual soot pollution levels for Lancaster improved considerably, raising Lancaster's rank from 22nd-worst to 32nd-worst.

Nationwide, pollution levels in 210 metropolitan areas generally were the best in the 13 years of the group's monitoring.

But not so here.

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