“Worsening Jobs Crisis”: America’s Middle Class Is Burning To The Ground, While Washington Fiddles With Scandal Nonsense
At last, some excellent economic news for folks long-mired in the stagnant labor market!
At least, those were the headlines recently trumpeted across the country. “Jobs Spring Back,” exclaimed a typical headline or report that companies added a better than expected 165,000 private-sector jobs in April. Wow — the thunderous, three-year boom of prosperity that has rained riches on Wall Street is finally beginning to shower on our streets, right?
Well, as dry-land farmers can tell you, thunder ain’t rain. Read beneath the joyful headlines hailing April’s uptick in job numbers, and you’ll see the parched truth.
For example, more than a third of working-age Americans are either out of work or have given up on finding a job. Also, last month’s hiring increase was almost entirely for receptionists, waiters, clerks, temp workers, car-rental agents and other low-wage positions with no benefits or upwardly mobile possibilities. On the other hand, manufacturing — generally the source of good, middle-class jobs — did not add workers in April and has cut some 10,000 jobs in the last year.
Especially problematic was the continued rise in underemployment — people wanting full-time work, but having to take part-time and temporary jobs. Underemployment is also pounding college graduates. While they’ve been more successful than non-grads at landing jobs, they’re not getting jobs that fit their career goals or even require the degrees they spent money and time to obtain. Indeed, many of those rental agents and restaurant employees you encounter hold four-year degrees, forcing everyone else to scramble for the few, even lower-paid jobs further down the skill ladder.
Meanwhile, the next graduating class is already beginning to flood into the labor market from colleges and high schools with nowhere to go.
In May, another headline shouted: “Stock Market Soars.” It expressed delight that the Dow Jones Average topped 15,000 for the first time in its history.
Yet this index of Wall Street wealth gives a totally false picture of our nation’s true economic health. Yes, the privileged few are doing extremely well. But the workaday many are struggling — and falling further and further behind as the jobs market sinks steadily from mere recession down into depression.
The monthly unemployment reports don’t tell the depths of misery that’s out here in the real world, beyond the view of Wall Street and Washington elites. For example, President Obama hailed the news that unemployment dipped to 7.5 percent in April. Unstated, though, was the stark reality that this good-news dip was not due to a jump in job offerings, but to a bad-news labor market so weak and discouraging that more and more Americans are dropping out of it or never entering it.
More than a third of our working-age population is no longer even in the job market, and only 58.6 percent of us are employed. Put the opposite way, 41 percent of the potential workforce is not working — about 102 million people. One more statistic, and it’s a chiller: More than one out of five American families report that, last year, not a single family member had a job.
Our people are trapped in a jobs crisis that is sucking the economic vitality out of our nation, but our leaders refuse even to acknowledge it, much less cope with it. In fact, corporate chieftains are deliberately exacerbating the crisis by hoarding trillions of dollars that ought to be rushed into job-creating expansions, and politicians keep adding to the casualties by gleefully eliminating the middle-class jobs of hundreds of thousands of teachers, firefighters, police and other valuable public employees.
America’s middle class is burning to the ground, while Washington fiddles with nonsense and Wall Street feathers its own nest. It’s disgraceful.
By: Jim Hightower, The National Memo, May 15, 2013
“Deeply Confused”: The Republican War On Data
The politics of paranoia can lead policymakers into some unfortunate directions. On everything from homeland security to education to guns, paranoid politicians invariably end up pushing some truly bizarre proposals for no good reason.
In the latest example, some far-right congressional Republicans have decided to wage a war on census data because they have paranoid ideas about “big government.”
A group of Republicans are cooking up legislation that could give President Barack Obama an unintentional assist with disagreeable unemployment numbers — by eliminating the key economic statistic altogether.
The bill, introduced last week by Rep. Jeff Duncan (R-S.C.), would bar the U.S. Census Bureau from conducting nearly all surveys except for a decennial population count. Such a step that would end the government’s ability to provide reliable estimates of the employment rate. Indeed, the government would not be able to produce any of the major economic indices that move markets every month, said multiple statistics experts, who were aghast at the proposal.
“They simply wouldn’t exist. We won’t have an unemployment rate,” said Ken Prewitt, the former director of the U.S. Census who is now a professor of public affairs at Columbia University.
The core issue is something called the American Community Survey, which the Census Bureau uses as a supplemental to the decennial reports, providing information on commuting, income, family structure, educational attainment, housing, and finance. The results are used extensively by businesses, researchers, academics, and government agencies, and have been an invaluable tool for decades.
Right-wing lawmakers, however, have come to believe nefarious government officials are collecting the information as part of a larger scheme — it’s never been entirely clear to me what they see as the point of the plot — that must be stopped. Sen. Rand Paul (K-Ky.), who revels in strange conspiracy theories, proposed legislation in March to make elements of the American Community Survey optional, apparently because he didn’t realize that they were already optional.
But it’s not just the American Community Survey that congressional Republicans are eager to crush.
Indeed, Rep. Jeff Duncan’s (R-S.C.) bizarre proposal, which has 10 co-sponsors, would also explicitly eliminate the agricultural census, economic census, government census, and mid-decade census.
As a consequence, Duncan’s bill would eliminate the existence of the unemployment rate and the measurement of the nation’s GDP, among other thing.
Maurine Haver, founder of business research firm Haver Analytics and a past president of the National Association for Business Economics, told the Huffington Post‘s Michael McAuliff, “Do they understand that these data that the Census Bureau collects are fundamental to everything else that’s done? They think the country doesn’t need to know how many people are unemployed, either?”
The answers to these questions are unclear — Duncan and other supporters of this proposal have not explained why they oppose the data, why they see the need to eliminate the data, or even if they understand what it is they’re doing.
Duncan, incidentally, is the same deeply confused congressman who spewed bizarre conspiracy theories about the Boston Marathon bombing, going so far that Homeland Security Secretary Janet Napolitano felt the need to say Duncan’s ignorant inquiries were “full of misstatements and misapprehensions,” and “not worthy of an answer.”
By: Steve Benen, The Maddow Blog, May 2, 2013
“The Story Of Our Time”: The Most Crucial Thing To Understand Is The Economy Is Not Like An Individual Family.
Those of us who have spent years arguing against premature fiscal austerity have just had a good two weeks. Academic studies that supposedly justified austerity have lost credibility; hard-liners in the European Commission and elsewhere have softened their rhetoric. The tone of the conversation has definitely changed.
My sense, however, is that many people still don’t understand what this is all about. So this seems like a good time to offer a sort of refresher on the nature of our economic woes, and why this remains a very bad time for spending cuts.
Let’s start with what may be the most crucial thing to understand: the economy is not like an individual family.
Families earn what they can, and spend as much as they think prudent; spending and earning opportunities are two different things. In the economy as a whole, however, income and spending are interdependent: my spending is your income, and your spending is my income. If both of us slash spending at the same time, both of our incomes will fall too.
And that’s what happened after the financial crisis of 2008. Many people suddenly cut spending, either because they chose to or because their creditors forced them to; meanwhile, not many people were able or willing to spend more. The result was a plunge in incomes that also caused a plunge in employment, creating the depression that persists to this day.
Why did spending plunge? Mainly because of a burst housing bubble and an overhang of private-sector debt — but if you ask me, people talk too much about what went wrong during the boom years and not enough about what we should be doing now. For no matter how lurid the excesses of the past, there’s no good reason that we should pay for them with year after year of mass unemployment.
So what could we do to reduce unemployment? The answer is, this is a time for above-normal government spending, to sustain the economy until the private sector is willing to spend again. The crucial point is that under current conditions, the government is not, repeat not, in competition with the private sector. Government spending doesn’t divert resources away from private uses; it puts unemployed resources to work. Government borrowing doesn’t crowd out private investment; it mobilizes funds that would otherwise go unused.
Now, just to be clear, this is not a case for more government spending and larger budget deficits under all circumstances — and the claim that people like me always want bigger deficits is just false. For the economy isn’t always like this — in fact, situations like the one we’re in are fairly rare. By all means let’s try to reduce deficits and bring down government indebtedness once normal conditions return and the economy is no longer depressed. But right now we’re still dealing with the aftermath of a once-in-three-generations financial crisis. This is no time for austerity.
O.K., I’ve just given you a story, but why should you believe it? There are, after all, people who insist that the real problem is on the economy’s supply side: that workers lack the skills they need, or that unemployment insurance has destroyed the incentive to work, or that the looming menace of universal health care is preventing hiring, or whatever. How do we know that they’re wrong?
Well, I could go on at length on this topic, but just look at the predictions the two sides in this debate have made. People like me predicted right from the start that large budget deficits would have little effect on interest rates, that large-scale “money printing” by the Fed (not a good description of actual Fed policy, but never mind) wouldn’t be inflationary, that austerity policies would lead to terrible economic downturns. The other side jeered, insisting that interest rates would skyrocket and that austerity would actually lead to economic expansion. Ask bond traders, or the suffering populations of Spain, Portugal and so on, how it actually turned out.
Is the story really that simple, and would it really be that easy to end the scourge of unemployment? Yes — but powerful people don’t want to believe it. Some of them have a visceral sense that suffering is good, that we must pay a price for past sins (even if the sinners then and the sufferers now are very different groups of people). Some of them see the crisis as an opportunity to dismantle the social safety net. And just about everyone in the policy elite takes cues from a wealthy minority that isn’t actually feeling much pain.
What has happened now, however, is that the drive for austerity has lost its intellectual fig leaf, and stands exposed as the expression of prejudice, opportunism and class interest it always was. And maybe, just maybe, that sudden exposure will give us a chance to start doing something about the depression we’re in.
By: Paul Krugman, Op-Ed Columnist, The New York Times, April 28, 2013
“Two America’s Truer Now Than Ever”: Perishing On A Lonely Island Of Poverty In The Midst Of A Vast Ocean Of Material Prosperity
You may think you know about Martin Luther King, Jr., but there is much about the man and his message we have conveniently forgotten. He was a prophet, like Amos, Isaiah and Jeremiah of old, calling kings and plutocrats to account — speaking truth to power.
King was only 39 when he was murdered in Memphis 45 years ago, on April 4th, 1968. The 1963 March on Washington and the 1965 March from Selma to Montgomery were behind him. So was the successful passage of the Civil Rights Act and the Voting Rights Act. In the last year of his life, as he moved toward Memphis and his death, he announced what he called the Poor People’s Campaign, a “multi-racial army” that would come to Washington, build an encampment and demand from Congress an “Economic Bill of Rights” for all Americans — black, white, or brown. He had long known that the fight for racial equality could not be separated from the need for economic equity — fairness for all, including working people and the poor.
Martin Luther King, Jr., had more than a dream — he envisioned what America could be, if only it lived up to its promise of life, liberty, and the pursuit of happiness for each and every citizen. That’s what we have conveniently forgotten as the years have passed and his reality has slowly been shrouded in the marble monuments of sainthood.
But read part of the speech Dr. King made at Stanford University in 1967, a year before his assassination and marvel at how relevant his words remain:
“There are literally two Americas. One America is beautiful for situation. And in a sense this America is overflowing with the milk of prosperity and the honey of opportunity. This America is the habitat of millions of people who have food and material necessities for their bodies, and culture and education for their minds; and freedom and dignity for their spirits…
“…Tragically and unfortunately, there is another America. This other America has a daily ugliness about it that constantly transforms the buoyancy of hope into the fatigue of despair. In this America millions of work-starved men walk the streets daily in search for jobs that do not exist. In this America millions of people find themselves living in rat-infected vermin-filled slums. In this America people are poor by the millions. They find themselves perishing on a lonely island of poverty in the midst of a vast ocean of material prosperity.”
Breathtakingly prescient words as we look around us at a society where the chasm between the super-rich and poor is wider and deeper than ever. According to a Department of Housing and Urban Development press release, “On a single night last January, 633,782 people were homeless in the United States.” The Institute for Policy Studies’ online weekly “Too Much” notes that single-room-occupancy shelter rates run about $558 per month and quotes analyst Paul Buchheit, who says that at that rate, “Any one of America’s ten richest collected enough in 2012 income to pay an entire year’s rent for all of America’s homeless.”
But why rent when you can buy? “Too Much” also reports that the widow of recently deceased financier Martin Zweig “amid a Manhattan luxury boom” has placed their apartment at the top of the posh Pierre Hotel on the market for $125 million: “A sale at that price would set a new New York record for a luxury personal residence, more than $30 million over the current real estate high marks.”
Meanwhile, a new briefing paper from the advocacy group National Employment Law Project (NELP) finds there are 27 million unemployed or underemployed workers in the U.S. labor force, including “not only the unemployed counted by official jobs reports, but also the eight million part-time workers who would rather be working full-time and the 6.8 million discouraged workers who want to work but who have stopped looking altogether.” Five years after the financial meltdown, “the average duration of unemployment remains at least twice that of any other recession since the 1950s.”
And if you think austerity’s a good idea, NELP estimates that, “Taken together, the ‘sequester’ and other budget-cutting policies will likely slow GDP this year by 2.1 percentage points, costing the U.S. economy over 2.4 million jobs.”
Walmart’s one of those companies laying people off, but according to the website Business Insider, the mega-chain’s CEO Michael Duke gets paid 1,034 times more than his average worker. Matter of fact, “In the past 30 years, compensation for chief executives in America has increased 127 times faster than the average worker’s salary.”
Two Americas indeed.
By: Bill Moyers and Michael Winship, Moyers and Company, April 10, 2013
“Cheating Our Children”: The Deficit Scolds Are Actually The Bad Guys In This Story
So, about that fiscal crisis — the one that would, any day now, turn us into Greece. Greece, I tell you: Never mind.
Over the past few weeks, there has been a remarkable change of position among the deficit scolds who have dominated economic policy debate for more than three years. It’s as if someone sent out a memo saying that the Chicken Little act, with its repeated warnings of a U.S. debt crisis that keeps not happening, has outlived its usefulness. Suddenly, the argument has changed: It’s not about the crisis next month; it’s about the long run, about not cheating our children. The deficit, we’re told, is really a moral issue.
There’s just one problem: The new argument is as bad as the old one. Yes, we are cheating our children, but the deficit has nothing to do with it.
Before I get there, a few words about the sudden switch in arguments.
There has, of course, been no explicit announcement of a change in position. But the signs are everywhere. Pundits who spent years trying to foster a sense of panic over the deficit have begun writing pieces lamenting the likelihood that there won’t be a crisis, after all. Maybe it wasn’t that significant when President Obama declared that we don’t face any “immediate” debt crisis, but it did represent a change in tone from his previous deficit-hawk rhetoric. And it was startling, indeed, when John Boehner, the speaker of the House, said exactly the same thing a few days later.
What happened? Basically, the numbers refuse to cooperate: Interest rates remain stubbornly low, deficits are declining and even 10-year budget projections basically show a stable fiscal outlook rather than exploding debt.
So talk of a fiscal crisis has subsided. Yet the deficit scolds haven’t given up on their determination to bully the nation into slashing Social Security and Medicare. So they have a new line: We must bring down the deficit right away because it’s “generational warfare,” imposing a crippling burden on the next generation.
What’s wrong with this argument? For one thing, it involves a fundamental misunderstanding of what debt does to the economy.
Contrary to almost everything you read in the papers or see on TV, debt doesn’t directly make our nation poorer; it’s essentially money we owe to ourselves. Deficits would indirectly be making us poorer if they were either leading to big trade deficits, increasing our overseas borrowing, or crowding out investment, reducing future productive capacity. But they aren’t: Trade deficits are down, not up, while business investment has actually recovered fairly strongly from the slump. And the main reason businesses aren’t investing more is inadequate demand. They’re sitting on lots of cash, despite soaring profits, because there’s no reason to expand capacity when you aren’t selling enough to use the capacity you have. In fact, you can think of deficits mainly as a way to put some of that idle cash to use.
Yet there is, as I said, a lot of truth to the charge that we’re cheating our children. How? By neglecting public investment and failing to provide jobs.
You don’t have to be a civil engineer to realize that America needs more and better infrastructure, but the latest “report card” from the American Society of Civil Engineers — with its tally of deficient dams, bridges, and more, and its overall grade of D+ — still makes startling and depressing reading. And right now — with vast numbers of unemployed construction workers and vast amounts of cash sitting idle — would be a great time to rebuild our infrastructure. Yet public investment has actually plunged since the slump began.
Or what about investing in our young? We’re cutting back there, too, having laid off hundreds of thousands of school teachers and slashed the aid that used to make college affordable for children of less-affluent families.
Last but not least, think of the waste of human potential caused by high unemployment among younger Americans — for example, among recent college graduates who can’t start their careers and will probably never make up the lost ground.
And why are we shortchanging the future so dramatically and inexcusably? Blame the deficit scolds, who weep crocodile tears over the supposed burden of debt on the next generation, but whose constant inveighing against the risks of government borrowing, by undercutting political support for public investment and job creation, has done far more to cheat our children than deficits ever did.
Fiscal policy is, indeed, a moral issue, and we should be ashamed of what we’re doing to the next generation’s economic prospects. But our sin involves investing too little, not borrowing too much — and the deficit scolds, for all their claims to have our children’s interests at heart, are actually the bad guys in this story.
By: Paul Krugman, Op-Ed Columnist, The New York Times, March 28, 2013
Share This Blog
Unknown Feed- An error has occurred; the feed is probably down. Try again later.
mykeystrokes.com 