"Do or Do not. There is no try."

“Enough Already”: The New York Times And The ACA, The Yuppie Whine-Athon Continues

I see the New York Times has published yet another article about very privileged people whining about the ACA.

In this case, said article features a couple making $100,000 a year who, under the ACA, will be paying $1,000 a month for health care. Take it away, Dean Baker:

Here they are with a front page story telling us about the tragic situation of the Chapmans, a New Hampshire couple making $100,000 a year who will have to spend $1,000 a month for insurance with Obamacare. This would come to 12 percent of their income. The piece tells readers:

“Experts consider health insurance unaffordable once it exceeds 10 percent of annual income.”

That’s interesting. If we go to the Kaiser Family Foundation website we find that the average employee contribution for an employer provided family plan is $4,240. The average employer contribution is $11,240. That gives us a total of $15,470. Most economists would say that we should treat the employers payment as a cost to the worker since in general employers are no more happy to pay money to health insurance companies than to their workers. If they didn’t pay this money as health insurance then they would be paying it to their workers in wages.

A couple of years ago, when my ex-husband and I were paying for health insurance under COBRA, we were shelling out something like $1,200 a month for just the two of us — and we were making far less than 100K a year. In fact, we were earning more like half that.

Enough already. In the real world we live in, $1,000 a month for good health insurance for two people in the top quintile of U.S. household income is pretty damn good. Upper middle class people, quitcher whining already — and New York Times, please stop enabling this nonsense.


By: Kathleen Geier, Washington Monthly Political Animal, December 21, 2013

December 22, 2013 Posted by | Affordable Care Act, Obamacare | , , , , , , | Leave a comment

“Why I Still Support Obamacare”: A Health Care Safety Net Under The Majority Is Morally Right And In The Interest Of A Stable Society

At the recent New York Times forum in Singapore, Eleonora Sharef, a co-founder of HireArt, was explaining what new skills employers were seeking from job applicants, but she really got the audience’s attention when she mentioned that her search firm was recently told by one employer that it wouldn’t look at any applicant for a marketing job who didn’t have at least 2,000 Twitter followers — and the more the better. She didn’t disclose the name of the firm, but she told me that it wasn’t Twitter.

At a meeting with students at Fudan University in Shanghai a few days earlier, I was struck by how anxious some of the Chinese students were about the question: “Am I going to have a job?” If you’re a software engineer in China, you’ll do fine, also a factory worker — but a plain-old college grad? The Times reported earlier this year that in China today “among people in their early 20s, those with a college degree were four times as likely to be unemployed as those with only an elementary school education.”

Stories like these explain why I really hope that Obamacare succeeds. Say what?

Here’s the logic: The Cold War era I grew up in was a world of insulated walls, both geopolitical and economic, so the pace of change was slower — you could work for the same company for 30 years — and because bosses had fewer alternatives, unions had greater leverage. The result was a middle class built on something called a high-wage or a decent-wage medium-skilled job, and the benefits that went with it.

The proliferation of such jobs meant that many people could lead a middle-class lifestyle — with less education and more security — because they didn’t have to compete so directly with either a computer or a machine that could do their jobs faster and better (by far the biggest source of job churn) or against an Indian or Chinese who would do their jobs cheaper. And by a middle-class lifestyle, I don’t mean just scraping by. I mean having status: enough money to buy a house, enjoy some leisure and offer your kids the opportunity to do better than you.

But thanks to the merger of globalization and the I.T. revolution that has unfolded over the last two decades — which is rapidly and radically transforming how knowledge and information are generated, disseminated and collaborated on to create value — “the high-wage, medium-skilled job is over,” says Stefanie Sanford, the chief of global policy and advocacy for the College Board. The only high-wage jobs that will support the kind of middle-class lifestyle of old will be high-skilled ones, requiring a commitment to rigorous education, adaptability and innovation, she added.

But will even this prescription for creating enough jobs with decent middle-class incomes suffice, asks James Manyika, who leads research on economic and technology trends at the McKinsey Global Institute. While these prescriptions are certainly “correct,” notes Manyika, they “may not be enough to solve for the scale and nature of the problem.” The pace of technologically driven productivity growth, he said, suggests that we may not need as many workers to drive equivalent levels of output and G.D.P.

As the M.I.T. economists Erik Brynjolfsson and Andrew McAfee show in their book “Race Against the Machine,” for the last two centuries productivity, median income and employment all rose together. No longer. Now we have record productivity, wealth and innovation, yet median incomes are falling, inequality is rising and high unemployment remains persistent.

To be sure, notes Manyika, a similar thing happened when we introduced technology to agriculture. We did not need as many people to produce food, so everybody shifted to manufacturing. As the same thing happened there, many people shifted to services.

But now, adds Manyika, “a growing share of high-paying services and knowledge work is also falling prey to technology.” And while new companies like Twitter are exciting, they do not employ people with high-paying jobs in large numbers. The economy and the service sector will still offer large numbers of jobs, but many simply may not sustain a true middle-class lifestyle.

As a result, argues Manyika, how we think about “employment” to sustain a middle-class lifestyle may need to expand “to include a broader set of possibilities for generating income” compared with the traditional job, with benefits and a well-grooved career path. To be in the middle class, you may need to consider not only high-skilled jobs, “but also more nontraditional forms of work,” explained Manyika. Work itself may have to be thought of as “a form of entrepreneurship” where you draw on all kinds of assets and skills to generate income.

This could mean leveraging your skills through Task Rabbit, or your car through Uber, or your spare bedroom through AirBnB to add up to a middle-class income.

In the end, this transition we’re going through could prove more exciting than people think, but right now asking large numbers of people to go from being an “employee” to a “work entrepreneur” feels scary and uncertain. Having a national health care safety net under the vast majority of Americans — to ease and enable people to make this transition — is both morally right and in the interest of everyone who wants a stable society.


By: Thomas L. Friedman, Op-Ed Columnist, The New york Times, November 10, 2013

November 11, 2013 Posted by | Affordable Care Act, Obamacare | , , , , , , , | Leave a comment

“Your Job Isn’t Safe Until Extremist’s Lose Theirs”: Tea Party Extremism Cost Millions Of Jobs And Risks Millions More

If Americans learn anything from this month’s shutdown-and-debt-ceiling debacle, they ought to realize that political extremism brings real costs—denominated in dollars and jobs as well as national cohesion and prestige—and that those costs are not small. So long as the Tea Party faction continues to wield its malign influence over the Republican leadership in Congress, the threat of further, even worse damage will not subside.

Everyone should heed the clear warning issued by Senator Ted Cruz (R-TX), his cohort on Capitol Hill, and the leaders of outfits such as the Tea Party Express and FreedomWorks, all enraged and determined to lash out again as soon as possible. “This was going to be a multi-stage, extended battle,” said Cruz, “but we’ve also seen a model that I think is the model going forward to defeat Obamacare, to bring back jobs, economic growth…”

Only a dwindling fraction of voters is still mesmerized by such demagogic nonsense, but their anger intimidates enough Republicans to ensure that Cruz and company can seek to sabotage the economy again—and they will. So it is vital for everyone to understand what these vandals have inflicted on us already.

We will probably not know the full cost of the shutdown and the near-default for several months, if ever, but fresh estimates are now arriving daily. According to Standard & Poor’s, the financial ratings agency, the shutdown alone reduced economic activity in the United States by at least $24 billion and cut growth in the current quarter by as much as 0.6 percent. That means a loss of thousands of jobs and billions in household income, just when the economy would traditionally surge upward for the holiday season.

But that is just the beginning of a much grimmer inventory of suffering, which can be traced back more than two years to the first episode of Tea Party debt-ceiling bluster. For that assessment, we can look to none other than the Peter G. Peterson Foundation—named for its creator, a former Republican Commerce Secretary and fanatical fiscal hawk—whose latest contribution to public discourse is a thorough study, with charts, of “the cost of crisis-driven fiscal policy.” Peterson’s full study is worth reading, but its essential points are simple enough.

The repeated manufacturing of partisan fiscal crises has created sufficient uncertainty to reduce growth since 2009 by as much as 0.3 percentage points annually—eliminating as many as 900,000 potential jobs.

Now add on the wrong-headed cuts in federal discretionary spending caused by budget sequestration—the awful “solution” to the 2011 debt crisis. That reduced annual growth by 0.7 points since 2010 and raised unemployment by almost a full percentage point, or 1.2 million lost jobs.

Finally, the report examines two possible economic scenarios that could follow a Treasury default: a “brief” recessionary interlude that would see unemployment jump to 8.5 percent, costing 2.5 million jobs, and a longer, deeper, more volatile recession in which joblessness would rise to 8.9 percent and more than three million jobs would be lost.

Just as disturbing as all this sad waste of human potential is the incredible pettiness of the goals pursued by the Republican leadership. Their ultimate, most pathetic demand was to deny health insurance to their own aides.

So when Ted Cruz and the Tea Party tell you their holy crusade against health care will “bring back jobs,” assume the opposite (and act accordingly). There is no bipartisan compromise on offer here— only more of the same ruinous obstruction, and worse.

Your job won’t be secure until they lose theirs.


By: Joe Conason, The National Memo, October 18, 2013

October 19, 2013 Posted by | Jobs, Republicans, Tea Party | , , , , , , | 1 Comment

“Suffering Under The Weight Of Inequality”: Reaching The Point That Endangers Growth Itself, And That Should Concern Everyone

A report released this week by an economist at the University of California, Berkeley, shows that income inequality in the U.S. economy is at a new high. As the economy struggles in the wake of the Great Recession, income inequality broke records going back nearly 100 years.

According to the study, incomes among the top one percent rose by 31.4 percent between 2009 and 2012, while incomes for everyone else grew just 0.4 percent. The top decile of earners in the economy now captures more than half the total income.

Predictably, the debate rages about fairness. Commentators on the left argue that this income distribution couldn’t possibly be fair to workers, while those on the right suggest that any distribution is inherently fair as long as all Americans have the opportunity to compete to make it to the top.

It is difficult to show that any particular distribution of income is the right place to draw the line between fair and unfair. Let’s leave that question to others and focus solely on the question of whether disparities of this magnitude help or hinder the economy as a whole.

Economists have shifted their position on this issue over time. At one point, most economists agreed that inequality probably helps the economy. Inequality spurs people to work harder. In addition, some inequality is needed to create a pool of concentrated wealth that can be invested to finance the early stages of economic development: harvesting timber, building factories and so on.

However, more recent research suggests that while some inequality is necessary, too much inequality undermines growth: The research shows that the U.S. economy is probably at or near the point where the negative effects of inequality outweigh the positive effects.

Now, inequality dampens growth in three ways:

  • Wealthy people handle their money differently than the rest. They tend to save a much higher percentage of their incremental income, or invest it in fixed assets like vacation homes. These forms of saving and investment do not trickle down to create significant wage income for others. In contrast, incremental money that flows to the middle class and poor people gets spent much more quickly. It’s spent on food, clothing and basic products that are produced in factories and on farms by people who earn wages. Money that flows to the middle class and poor has a multiplier effect, rippling through the economy to create more jobs and income for others. As a result, a shift in income towards the top results in less overall demand.
  • In a nation like ours, where higher education is expensive, greater inequality means that fewer people get the skills they need for well-paying jobs. But as World Bank economist Branko Milanovic writes, “now that human capital is scarcer than machines, widespread education has become the secret to growth.” Facing a less prepared workforce, companies shift research and advanced manufacturing facilities offshore, which further erodes economic growth. The shift increases the chance that the next Facebook will be founded in India or China. Some other country will reap the economic benefit that comes from hosting breakthrough innovation.
  • Other factors beyond the hard costs of higher education are important as well, as inequality rises and class lines harden. Consider two children, both with the same innate potential for accomplishment, one born to a family in the top 1 percent and the other to a family in the bottom 20 percent. The first one will have parents who read to them as a pre-schooler, stimulating his or her brain. The second one, probably not. The first one will grow up surrounded by role models whose hard work brought them success; the second one will grow up surrounded by others whose hard work brought them barely-livable incomes. Is it any wonder that the two children will enter adult life with a different readiness to use their intellect, a different level of motivation and confidence and a different awareness of how to build a successful career?

Two economists, Andrew Berg and Jonathan D. Ostry of the International Monetary Fund, have quantified the impact of inequality on economic growth. In a 2011 article, “Inequality and Unsustainable Growth: Two Sides of the Same Coin?” they examined why some countries enjoy long years of steady economic growth while other countries see their growth trail off after only a few years.

Berg and Ostry found that income inequality is the single most important factor in determining which countries can keep their economies growing. For example, income distribution is more important than open trading arrangements, favorable exchange rates and the quality of the country’s political institutions.

Berg and Ostry go on to measure the extent to which economic growth falls as inequality rises. They gauge inequality using the GINI coefficient, which ranges for 0 – 100. At one extreme, a society where everyone earns exactly the same would have a GINI score of 0. At the other extreme, a society in which one person owned all the wealth would have a GINI score of 100. For economies with GINI below 45, growth can be robust, but once it crosses above roughly 45, growth slumps. The GINI of the U.S. economy is in the low 40’s currently, so we are dangerously close to the point of decline.

Inequality in the U.S. shows no sign of abating, even as the economy recovers. The decline of unions, the pace of globalization, the abundance of workers in many industries and changes in health care and taxes have combined to staunch the earning power of working Americans, even as the economy grows and productivity increases. There are few options, and none that are consistent with the political climate of the time. But the trend is reaching the point that endangers growth itself, and that should concern everyone, regardless of the size of your paycheck.


By: David Brodwin, U. S. News and World Report, September 12, 2013

September 14, 2013 Posted by | Economic Inequality, Economic Recovery | , , , , , , , | Leave a comment

“The Rejection Of Reality”: Conservative Claims About Low-Income Excess Are Just Wrong

Are people better off than they were before the recession? By most headline figures they’re not: Poverty and inequality have risen to record levels, median incomes declined. Unemployment has improved marginally, but 37 states have yet to regain their pre-recession job levels.

Conservatives like to push back on claims of rising inequality or worsening poverty by pointing out that their measure of poverty or inequality insufficiently captures the increasing well-being of even the poor. They’re better off, they say, because low and middle-income Americans are living better than they did in the past. These arguments manifest themselves in concern over “Obamaphones” or access to liquor or drugs, and generally recommend policy solutions as odious as drug-testing as a prerequisite for welfare or stricter control over food stamps. As Matt Bruenig aptly pointed out on this blog, even taking these conservative policy solutions at their face value, fraud complaints are spurious. We want poor people to have more money. Programs like food stamps and Medicaid undoubtedly accomplish that.

But let’s dive deeper into whether families are better off. The Census Bureau periodically publishes assessments of well-being. Their most recent iteration, released yesterday, measures well-being comprehensively based on various conditions such as homeownership (or rentership) and housing condition, access to appliances and electronic goods, neighborhood conditions, meeting basic needs to avoid eviction and eat, and ability to get help from families or the community should they need it. Most of the trends in the results aren’t shocking, with extreme differences in situation based on age, sex and race.

Their headline results are sobering, however. How households fared from 2005 to 2011, according to the Census Bureau’s more comprehensive assessment:

Families are having an increasingly difficult time paying basic expenses. From 2005 to 2011, the number of Americans who couldn’t pay rent or afford food climbed from 16.4 to 16.9 million, a 16 percent increase.

Households with unmet essential expenses increased from 16.4 to 20 million. One in five households now experience difficulty meeting basic needs.

Those experiencing food shortages increased from 2.7 to 3.4 million.

A plurality of households lack access to basic appliances. 36 percent of households didn’t have either a washer, dryer, fridge, stove, dishwasher or phone.

There are strong racial correlations to decreased well-being. Only 44 percent of Hispanics reported access to all six basic appliances compared with 71 percent of white households.

So, even conceding that headline stats don’t tell the whole story, conservative arguments fail on their own merits. No, there isn’t an increasing access to basic appliances that would signal a middle-class lifestyle. No, low-income families aren’t better able to meet basic needs like paying rent or purchasing food. Families are worse off because they’re poorer. Making some goods (like phones) marginally less expensive in the face of collapsing incomes and household wealth hasn’t truly improved the plight of low-income workers. Trying to restrict or reduce proven government programs despite these conditions isn’t then a conservative acknowledgement of nuance, it’s the rejection of reality.


By: Joe Hines, The American Prospect, September 6, 2013

September 7, 2013 Posted by | Economic Inequality, Poverty | , , , , , , , | Leave a comment

%d bloggers like this: