« The Friday saloon | Main | The Friday saloon »

September 09, 2013

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

"There are only 5000 people in the world, they are called bankers"
Every one else are called commodities.

After the next recession, the bankers will live in castles surrounded by napalm moats and shall be called Lords. And Sheriff's John and Joe in their Bolo tanks will be there to collect the taxes and keep secure the worlds Barons.

I will gladly dip torches in their napalm moats.

It's a faux security they secure.

The last thing the well off want collectively is broad based higher wages and a reversal of long term middle earner wage decline.

Their wealth has been greatly enhanced the past few years by low, low interest rates. Prices have remained stable and profit margins for large corporations have been wide.

Higher wages could threaten both price stability and low interest rates. The work force is so compliant and docile. What's not to like for the corporate elite?

"The happiest people in the world apparently reside in northern Europe, according to a 156-nation survey published by the United Nations Sustainable Development Solutions Network."

Conan and Robert Reich agree with my first comment. See Movie/Documentary, Equality for All, starring Reich.

Many baby boomers headed for retirement were those caught in transition on the wrong side of the 2008 collapse. Hardly a voluntary act on their part which would be a structural change in the workforce. But the equity markets and economists will define them as such because the political concern and willpower just doesn't exist to create a robust job market. After years on the sidelines, they will be retired by default.

The good news for Phoenix, unlike Seattle, is that it doesn't have a lot of high wage jobs or powerhouse corporations to lose. Sad to observe that 25 years of well above average population and job growth in Phoenix has done little to transform the metropolitan area from a resort town and low wage environment into something more prosperous.

Seattle though could be this era's Detroit. Chest pumping and confident, the new generation of yuppies in Seattle view themselves much like the residents of Detroit saw themselves during the peak of the rust belt.

Boeing could continue to relocate high paying jobs to low wage regions. Is Amazon in a bubble and anything greater than this era's Sears Roebuck? Starbucks and Costco both retailers with product shelf lives.

Minneapolis, Dallas and Houston for example, have greater staying power due to food production and natural resources which are foundational industries that cannot be off shored like all the activity in technologically confident Seattle. Washington DC, NYC and Boston will survive nicely with their disproportionate control of finance, the White House and Congress. Not much different historically from the east coast political power a century ago.

Phoenix is what it is. The bottom is clear and the greatest threat is climate change and water shortages. Arizona's elected officials, NRA approved and death penalty qualified, totally lack the leadership ability to attract knowledge industries of the 21 century. To date, their embarrassing ultra right wing behavior has repelled the well educated and thinking industries of the future.


I skimmed an article this morning about how unintended pregnancies are dropping in the U.S. but the bulk of those that still occur are among low-income women. The first thought that crossed my mind was that the wealthy are working on creating a new peasant class, similar to feudal Europe. While I certainly think that the conservative war on birth control including abortion is largely a war against women, I also think that the forced birth agenda is an intentional drive to keep the new peasant class large and at the mercy of the new Landlords. The conservative agenda to undermine public education is part and parcel of the same process.

Annalisa: Welcome to the world of "keeping them down"

Jon u might want to catch AlanWeismans Countdown: our last best hope for a future on earth.

These overpaid corporate leaders do not fear the next Great Recession as they reside in heavily guarded-fenced in communities containing their beloved golf courses. No need to go out and mix with pissed off peasants as their food and other items are delivered directly to them by others.

But these problems have been brewing for years once we decided as a nation to favor cars over people. The design of our neighborhoods & codes, strip malls-stores with maxed out parking lots, major urban centers with 6-plus lanes of highways through their core, etc worked to make our dependence on the MidEast inevitable. Once one car families were the norm, now home garages for 3-4 cars are expected. Consequently no need (ie. demand) for light urban or even high speed rail.

What happens to our ability to be empathetic, civil and perhaps even work together to solve mutual problems? As explained decades ago in Motormania (still good for a laugh): http://www.youtube.com/watch?v=hk-c5jlk48s

As a 'boomer born in 1949, it has been a challenge to maintain a middle class lifestyle throughout my working life and it will continue to be a challenge as retirement approaches.

I could go into detail about the career changes I've been forced to make to continue moving forward, economically speaking, instead of backwards.

The only advice that I would give to a young adult would be for them to get the most education they can before seriously embarking on their adult life/career (usually in your late twenties or early thirties).

It really doesn't matter what you get your degrees in. If it's English Lit. you like, go for it, and the hell with the worries about what kind of job you can get with it. Take a few theatre classes and learn how to act a little. You'll come off a lot better in interviews.

The fact that you have an MA in something will demonstrate to potential employers that you don't give up and you finish what you start.

Survival education not need be a college degree in Literature. I encounter folks all day long that dont know what a screwdriver is let alone how to use it. So they have to call someone that charges big bucks to fix whatever. Like changing a door lock or checking the oil and water in their car. Oh look honey there's smoke coming out from under the hood. Most Universities do not offer courses in fixing it, except in the financial world where the fix is in.

I hear ya, Lash. Many of the people who consider themselves the 'producers' couldn't produce a spare tire out their trunk and put it on the car -- or run a hotdog stand, for that matter. Can you imagine the chaos if Dick Cheney or 'W' were managing a 7-11?

The path to becoming a millionaire would be better served for someone young and ambitious by becoming an apprentice plumber or Landscaper.

I did my stint as a landscaper when I was young and was able to turn that into a living that far outshone my salary as a high school teacher.

But the skills that acquired in college helped me to succeed in that path, as well.

mechanics by day. Lit by nite
A romantic handy man with a

...with a what? An overly bright under bite grinning while he's hunting snipe?

The advantage of a high school education in AZ was that it gave you 4 or 5 hours a day to read novels while the teacher blathered and the best of other students attempted to learn.

Those of you who know cal, know that a pretty woman must have walked by in mid-sentence.

Anyone that didnt go to school can finish that sentence

Annalisa, I hope you are not correct, but your theory is a plausible as any I have heard.

The movie with Robert Reich is ‘Inequality For All’. Cal, you made a mistake.
You can watch the preview here: http://youtu.be/9REdcxfie3M

Ur right Countdown was someting else on my mind. Something about population at 1o mil

Unless you're a one-percenter, it's all rigged against you.

Well, if the fall dont kills us , we will probably drown.

Five years ago this week, the giant investment bank Lehman Brothers collapsed. This set in train the worst economic crisis since the Great Depression. The world went into barely avoided a second depression.

Minor editing for ya, but otherwise, spot-on.

Morris Berman has written three persuasive books on American decline and cites many reasons besides rampant corporatism. Good reads.

Dawgzy -- Please list a few of the reasons.

Reason One: The breakdown of the family, which rests squarely on the shoulders of the baby boomers.

It is our legacy. Broken families, broken children, broken grandchildren.

It will take generations to fix, if it can be fixed.

R. Perez/AzRebel - that is a very brave declaration you've made; and, so true, so true.

Mr. Talton wrote:

"Even if we continued to see 169,000 jobs per month added — unlikely — it would take until mid-2023 before we regained the employment level of 2008. A recession comes along about every seven years, so even that horrid timeline is unrealistic."

These figures from The Hamilton Project are misleading. Here's what your source has to say:

"As of February, our nation faces a jobs gap of 11.4 million jobs, 5.2 million from jobs lost since 2007, and another 6.1 million jobs that should have been created in the absence of the recession."

So, first of all, this "jobs gap" includes the jobs that *would have* been created (according to THP) if there had NOT been a recession.

Second, the remaining figure of "5.2 million jobs lost since 2007" is hopelessly exaggerated. (I don't know how THP doesn't derived that number.) If you look at the Bureau of Labor Statistics reports, you find that as if December 2007 there were 146,211,000 employed; in August 2013 that figure was 144,170,000 for a difference of slightly over 2 million fewer jobs today than in December 2007.

At the rate of 200,000 jobs per month it would take just 10 months to get back to the same number of jobs. Even at an anemic 150,000 jobs added each month (on average) it would only take 13 months.

I just noticed that The Hamilton Project figure of 5.2 million jobs lost since December 2007 came from a report dated March 2012. So, job growth since then partially accounts for this exaggerated figure.

http://www.hamiltonproject.org/papers/understanding_the_jobs_gap_and_what_it_says_about_americas_evolving_wo/

Mr. Talton wrote:

"Unemployment, at 7.3 percent, is at a level that would have been considered a crisis in the post-World War II era."

I don't think so. Traditionally, 5 percent was regarded as "full employment" according to a Washington Post review of historical unemployment rates (since WW II, during the Reagan era, the Clinton era, etc.).

http://www.washingtonpost.com/wp-srv/special/business/us-unemployment-rate-history/

The average annual unemployment rate during the Ford administration was 8 percent; under Carter it was 6.54%; under Reagan it was 7.54%; under Bush Sr. it was 6.3%; under Clinton and Bush Jr. about 5.2%.

http://www.truthfulpolitics.com/http:/truthfulpolitics.com/comments/u-s-national-unemployment-by-political-party-president/

One big difference in the current recovery is that private sector job growth is being offset by a historically abnormal loss of government jobs (especially state and local). In previous recoveries government jobs expanded; in the current recovery, federal, state, and local jobs are about 733,000 lower in August 2013 than they were in July 2009. State and local governments alone have cut more than 500,000 jobs since then. According to the Council of Economic Advisors, if state and local governments alone had simply kept static job levels (without new hires) as of the start of the recovery, the unemployment rate would be below 7 percent.

http://www.whitehouse.gov/blog/2013/09/06/employment-situation-august

They omitted the federal data for obvious reasons, but my figures for total government jobs lost since the recession come directly from Bureau of Labor Statistics data (government workers for the two months in question).

So, it's very possible that a more normal recovery mode in the government sector would have resulted in an unemployment rate today similar to the average under the senior Bush. Not great but scarcely crisis level unemployment.

Interesting column. No more online time so can't address the rest of it today.

See if this ends italics.

‘Can the Government Actually Do Anything About Inequality?’ This article by Thomas B. Edsall is interesting:

http://opinionator.blogs.nytimes.com/2013/09/10/can-the-government-actually-do-anything-about-inequality/?src=me&ref=general

The government could do plenty to address inequality, specifically progressive taxes, ending rent seeking and aggressive antitrust enforcement.

An inept, corrupt government can only create more ineptitude and more corruption.

Perez- So, two earner families were created out of whole cloth by 'boomers without any corporate influence on the matter?

Think about wage stagnation for men and advent of women in the job market. Did Rosie the Riveter have anything to do with that? Men's wages stagnate and women point the finger at wage earning men as the cause of their lesser earnings.

Win-Win for corporate America.

Please....

Good points Emil.

Stats be dammed.
"crisis level unemployment."
If you dont believe this (because of a closeted statistic environment) please get out of the cocoon you live in and see the real world.

Stats were cited to make a case. Naturally, they have to be examined to see whether and to what extent they actually do make that case.

I don't "live in a cocoon", but it's important to understand that one's local conditions (whatever they are) don't constitute national conditions in such a case. There are neighborhoods and areas where unemployment is very high, and others where it is very low. That's one reason why stats are important. You have to look at the big picture. And at the risk of allowing Cal Lash's splenetic outbursts to provoke a like response, I don't think any reasonable person would consider his trailer and a couple of coffee shops or bookstores to constitute the big picture.

Taking a small data sample by limited personal observation is bad enough; doing so with strong preconceptions is worse, because it tends to result in confirmation bias: you see what you want to see, ignore what you don't want to see, and tend to interpret things in a way that supports your viewpoint. That's a dangerous habit for anyone interested in getting at the truth.

I'm not here to preach to the choir and I reserve the right to respectfully disagree without being personally attacked. If you disagree with my arguments or documentation, then offer counterarguments or a critical analysis of the methodology. I don't claim to offer the last word on the subject and I'm open to being convinced; but simply dismissing statistics (which is all the "unemployment rate" is and can be) is petulant nonsense.

"Crisis" is my word (not mine alone), but I welcome Emil's counterarguments.

A couple of interesting items from the St. Louis Fed's wonderful FRED charts:

http://research.stlouisfed.org/fred2/series/U6RATE

http://research.stlouisfed.org/fred2/series/UNRATE

Mr. Talton wrote:

"Adjusted for inflation, 40 percent of American workers earn less than the minimum wage in 1968."

A much better case can be made for wage stagnation (and decline) than Tyler Durden's seriously flawed argument.

First, and really quite important, the argument that 40 percent of "workers" earn less than $20,000 a year is completely misleading. The Social Security Administration tables that Durden uses say only that 40 percent of those filing W-2 forms earn less than $20,000; but the first category in the tables is workers earning $0 to $4,999; those earning less than $10,000 account for 25 percent of those making less than $20,000 a year; including those who work only the shortest part-time hours drags the average way down and the result doesn't say a lot about American workers in general.

http://www.ssa.gov/cgi-bin/netcomp.cgi?year=2011

Second, using the minimum wage says a lot more about the rate of change of the minimum wage than it does about wages in general. Only 4.7 percent of hourly wage workers earned the minimum in 2012.

Durden uses an inflation calculator to determine the present value of the 1968 minimum wage; getting a figure of $10.74; but if you change the date to 1990 when the minimum wage was $3.80, the same inflation calculator gives a present value of $6.79, which is less than the current minimum wage of $7.25.

Furthermore, for some workers, the minimum wage in 1968 was $1.15, and the present value of that is $7.72 not $10.74.

http://www.dol.gov/whd/minwage/chart.htm

Out of online time today...

Emil: Here's where you get into trouble when you expect others to simply assess your argument in a logical way and dispense with the personal attacks --

"I'm not here to preach to the choir and I reserve the right to respectfully disagree without being personally attacked.

............................

...but simply dismissing statistics (which is all the "unemployment rate" is and can be) is petulant nonsense."

So, it seems that you reserve the right for yourself to label what you consider nonsense as being, in addition to mere nonsense, 'petulant' nonsense.

Consider, for a moment, that statistically speaking, there is a 25% chance that 'nonsense' will get a negative attack, but a label of 'petulant' nonsense can be 99.9% guaranteed to get the FU response that you so abhor.

Grover Norquist once petulantly mused that everyone knew that Mitt Romney was a 'poopy head' -- and Norquist is frequently on the tube offering his juvenile analyses of current events as a supposedly serious voice of the political Right.

It truly is an amazing country we live in where commenters on a political blog have higher standards than the supposed savants that are broadcast to the public on a daily basis.

My view is that each commenter should have maximum latitude to write with passion and verve. He or she has to decide when a pithy comeback can be interpreted as a turn-off. We don't suffer from the terrible trolls that infested my old blog on AzCentral.

Also, be aware the site is under a major spam attack. I will be out this afternoon, so if your post gets in the spam bin, I will dig it out tonight.

If only one could catch Grover near a bathtub or even a drainage ditch.

I'm finding it more and more difficult to secure reasons for going on. There is nothing bright about our future and our present is even more dim.

SD Mittelsteadt, The Archdruid can be comforting, if read with an open mind:

A Sense of Homecoming

(Don't spam-filter me, bro.)

SD Mittelsteadt: A lot of people who are political junkies take a perverse joy in harping on the negative, myself included. Don't let it get to you.

Go see a ball game. Drink a beer. Eat a hot dog. You'll feel better -- especially if your team wins. Rainiers 7 ------ River Cats 1

They were very petulant about the loss.

Emil, I think the jobs gap numbers of Hamilton and others factor in growth in working age population. Getting back to 146 million jobs doesn't mean the jobs gap has been eliminated if the working age population is larger. There's been a steady decline in the percentage of working age Americans employed, as Krugman, DeLong, Atrios and many others point out. That strikes me as a better measure of the continuing slump.

Note: a copy of this was posted in the following Friday Saloon.

* * *

Changes in U.S. employment are complex and longstanding, and Mr. Talton has written eloquently on many of these changes in previous blogs. That said, I felt that the previous thread (The Permanent Crisis) was unfinished.

In particular, I thought it might be interesting, in evaluating the issue of the economic recovery, to examine which types of jobs have yet (as of August 2013) to recover their pre-recession levels (December 2007).

For figures on this I consulted The Employment Situation, a detailed monthly report issued by the Bureau of Labor Statistics, for the two months in question and compared figures.

I found that just three categories (or sub-categories) account for nearly all of the "jobs gap":

The largest is "Office and administrative support occupations", which is still roughly 2.5 million jobs behind the December 2007 level.

The next largest is "Construction and extraction occupations", which is still roughly 1.9 million jobs behind the December 2007 level.

The third category is "Production occupations" -- essentially manufacturing -- which is still about 1.1 million jobs behind the December 2007 level.

You'll notice that the sum of these jobs gaps adds to a total of 5.5 million, despite the fact that employment as a whole is only about 2 million behind the level of December 2007. That is because many other categories have gained jobs, so that 2 million is the net total jobs gap.

In other words, office workers, construction workers, and manufacturing workers are the three sectors still way behind December 2007 levels and accounting for the vast bulk of the jobs gap.

Sectors that have larger employment (more jobs) now relative to December 2007 include, as broad categories: Management, business, and financial operations occupations; professional and related occupations; service occupations; and sales occupations.

Of course, this says nothing about the quality of jobs added (a larger percentage of which are temp positions). What it does do, however, is give a starting point for a discussion about changing employment dynamics in the United States.

It isn't surprising that construction jobs tanked and haven't recovered after a housing and credit crash of the magnitude seen during and immediately following the recession. Bear in mind that construction job losses are the second largest category among those in the jobs gap. These jobs will recover once the housing market recovers.

Manufacturing jobs are the third largest loss in the jobs gap category. In my opinion this reflects not only layoffs during the recession, but the determination of manufacturing employers to further cut labor costs and attendant risks with additional automation and outsourcing; if so, this represents the tail of a long downward trend in manufacturing jobs in America and they likely will not be recovered.

As for the largest category, office and administrative support occupations, I'm a little surprised and not sure what to make of it. My guess would be that the clerical professions are seeing the same kind of management-led cost retrenchment that manufacturing has seen: more automation and outsourcing, to cut labor costs while maintaining productivity.

* * *

I thought it might be interesting, in evaluating the issue of the economic recovery, to examine which types of jobs have yet (as of August 2013) to recover their pre-recession levels (December 2007).

For figures on this I consulted The Employment Situation, a detailed monthly report issued by the Bureau of Labor Statistics, for the two months in question and compared figures.

I found that just three categories (or sub-categories) account for nearly all of the "jobs gap":

The largest is "Office and administrative support occupations", which is still roughly 2.5 million jobs behind the December 2007 level.

The next largest is "Construction and extraction occupations", which is still roughly 1.9 million jobs behind the December 2007 level.

The third category is "Production occupations" -- essentially manufacturing -- which is still about 1.1 million jobs behind the December 2007 level.

You'll notice that the sum of these jobs gaps adds to a total of 5.5 million, despite the fact that employment as a whole is only about 2 million behind the level of December 2007. That is because many other categories have gained jobs, so that 2 million is the net total jobs gap.

In other words, office workers, construction workers, and manufacturing workers are the three sectors still way behind December 2007 levels and accounting for the vast bulk of the jobs gap.

Sectors that have larger employment (more jobs) now relative to December 2007 include, as broad categories: Management, business, and financial operations occupations; professional and related occupations; service occupations; and sales occupations.

Of course, this says nothing about the quality of jobs added (a larger percentage of which are temp positions). What it does do, however, is give a starting point for a discussion about changing employment dynamics in the United States.

It isn't surprising that construction jobs tanked and haven't recovered after a housing and credit crash of the magnitude seen during and immediately following the recession.
Bear in mind that construction job losses are the second largest category among those in the jobs gap. These jobs will recover once the housing market recovers.

Manufacturing jobs are the third largest loss in the jobs gap category. In my opinion this reflects not only layoffs during the recession, but the determination of manufacturing employers to further cut labor costs and attendant risks with additional automation and outsourcing; if so, this represents the tail of a long downward trend in manufacturing jobs in America and they likely will not be recovered.

As for the largest category, office and administrative support occupations, I'm a little surprised and not sure what to make of it. My guess would be that the clerical professions are seeing the same kind of management-led cost retrenchment that manufacturing has seen: more automation and outsourcing, to cut labor costs while maintaining productivity.

Search terms on Google – “how many times did congress block obama”
About 60,200,000 results (0.31 seconds)

http://www.dispatch.com/content/stories/editorials/2012/06/13/gop-strategy-block-obama-then-blame-him.html

http://www.policymic.com/articles/9124/unemployment-is-high-by-republican-design-as-gop-sabotaged-obama-s-job-proposals

http://www.policymic.com/articles/11510/senate-republicans-block-another-jobs-bill-face-backlash-from-american-public

I think that Republican blocking of Obama jobs initiatives, funds for infrastructure repair and new infrastucture building, and foot-dragging on development of alternative forms of energy explain the lack of performance in the types of jobs that you specified.
....................

The comments to this entry are closed.

Your email address:


Powered by FeedBlitz