A Year That Did Truly Suck

2014 sucked. That's pretty much the consensus. Here's an (incomplete) list why, in no particular order:

> Russia attempted to host the Winter Olympics in Sochi and dark comedy ensued... 

> ...Including Russia's re-drawing Europe's borders for the first time since World War II (HA! HA! Who's laughing now, decadent West!)

> Commercial airplanes were shot down (with no repercussions), or just disappeared without a trace. 

> Global warming is definitely happening and it's probably unrealistic to do anything about it now.

> Foreign tax inversions to avoid U.S taxes officially became a cool "thing" in the corporate world.

> Old wars became young and bloody again in Syria and Iraq.

> Ebola scared the shit out of us -- no deaths though -- and killed from 5 to 15 thousand of them, over there, where they tend to be scared less and die more.

> ISIS / ISIL / Islamic State / Daesh / Those Crazy Murderers In Two Countries Where Lots of People Get Murdered.

> It became news to us (but not to them, or the people they've been shooting) that U.S. police can shoot just about anybody and get away with it.

> Although the U.S. unemployment rate dropped to 5.8 percent of the labor force in November 2014, the lowest since July 2008, the labor force participation rate (i.e. excluding those too young, old, sick or beaten down by failure to work) is still below 63 percent; and wages were up only 2 percent for the year.

> Congress did not raise the minimum wage, again.

> Voter ID laws are still in effect (mainly in the South) and still doing what they're intended to do: suppress youth and minority votes.

> Red Lobster (a fav of ur's truly) became an economic bellwether instead of that place with the cheesy biscuits.

> We found out (but weren't really surprised) that up to 18 percent of NCAA revenue sports athletes read like children.

> We discovered that sandwich makers earning minimum wage are being asked to sign non-compete agreements.

> We found out the CIA is filled with sadistic, sicko torturers (and their defenders) who are nonetheless incompetent.

> The GOP held onto the House and took over the Senate.

> The GOP put taxpayers on the hook in the amount of $300 trillion in bailouts for Wall Street's derivatives bets.

> U.S. corporations are even more, uh, endowed with personhood than ever.

> Likewise, robots (AI) continued their exponential Moore's-rate progress toward enslaving humanity... or just taking all humanity's jobs.

> Still no federal prosecutions of Wall Street banks that committed securities fraud, wire fraud, perjury during Congressional testimony.... (Thanks, Obama and Eric Holder)

> Stephen Colbert put to rest The Colbert Report -- and worse -- his genius farcical Bill O'Reilly persona.

> Dick Cheney managed to stay alive -- and stay on FOX -- for another year.

Did I miss anything?

2014 sucked for conservatives as well. I hear their whining so I know. Yet few of these will sound like victories to liberals (and notice that most involve Obama):

> Obamacare remains the law of the land (because the federal government remains funded).

> 44 states have adopted Common Core standards.

> Obama escaped an impeachment vote on (take your pick).

> The Keystone XL pipeline is still not approved.

> Obama remains extremely popular abroad.

> Uppity blacks (no, they don't use that adjective anymore!) protested and rioted about police all over the country and didn't seem to be punished for it.

> The Tea Parties' power in the GOP diminished and the Establishment came back.

> The gay marriage steamroller is unstoppable.

> Obama's Ebola "czar" wasn't qualified to thwart an Ebola epidemic that wasn't coming anyway.

> Obama granted "amnesty" to approx. 11 million illegals.

> Unlike the last guy, this Pope is a flaming lib.

> Obama's Attorney General Eric Holder got to leave his job at the time and manner of his own choosing.

> Obama tightened rules for US coal power plants and made a deal with China on greenhouse gas emissions.

> And all of Obama's other "tyrannical" executive orders (yeah, you know the ones, don't get me started).

> White conservatives lost their best black spokesman for personal responsibility among African-American males when it was revealed he was a serial rapist. (On the other side, liberals lost a great stand-up comedian).

> The latest (the 10th?) GOP Congressional report on Benghazi! did not conclude that Hillary Clinton murdered those four Americans with her bare hands.

> And Hillary seems like an unbeatable juggernaut in 2016 when compared to (insert RINO or TP wacko's name here).

2014 sucked for me as well. Maybe the worst year ever. For instance, being unemployed for most of it. Of course there are always silver linings, silver linings...

Begone and good riddance, 2014!  2015, you'll have to try really hard to suck worse. Talk to you next year, folks!

Unemployed don't need job training, they need jobs

Peter Van Buren's view is pretty controversial. Then again, anything that refutes accepted wisdom usually is controversial.

On Van Buren's side though is economics: supply and demand. Giving unemployed people job skills or even training in trades is like working only on the (labor) supply side, while ignoring whether those skills or trades are demanded by employers.

"So the $18 billion question is: If job training is not the answer, what is?" asks Van Buren.

The obvious answers, grounded in tested economics, will make self-styled "free-marketers" uncomfortable [emphasis mine]:

Jobs. Jobs that pay a living wage. The 2008 recession wiped out primarily high- and middle-wage jobs, with the strongestemployment growth in the recovery taking place in low-wage employment, to the point where the United States has the highest number of workers in low-wage jobs of all industrialized nations.

There are many possible paths to better-paying jobs in the United States where consumer spending alone has the power to spark a “virtuous cycle.” That would mean more employment leading to more spending and more demand, followed by more hiring. One kickstarter is simply higher wages in the jobs we do have. For example, recent Department of Labor studies show that the 13 states that raised their minimum wages added jobs (at higher wages of course) at a faster pace than those that did not. On a larger, albeit more contentious scale, are options such as a WPA-like program, changes to tax and import laws to promote domestic manufacturing, infrastructure grants and the like. There’s the $18 billion being spent on job training that could be repurposed for a start.

No matter the path forward, the bottom line remains unchanged: Training does not create jobs. Jobs create the need for training. Anything else is just politics.

Nevertheless, I imagine that Democrats and Republicans wouldn't be willing to give up the promising-sounding idea of jobs training. Therefore my suggestion is for the government to pay for job training only when it is tied to a real job offer at a real company. I mean, first a company must say, "I promise, before the government spends a cent on training, to hire x  number of workers who have mastered a, b and c  skills."  That might work. Then the government would have to hold them to it. 

But I doubt that many companies would go for it; they'd want to retain right of refusal.

$18 billion in job training = lots of trained unemployed people

By Peter Van Buren

July 23, 2014 | Reuters

URL: http://www.reuters.com/article/idUS92508355420140723

The backwards South is moving backward

It's strange and pathetic how the today's Southern states promotes themselves to businesses and investors as a kind of third-world enclave within the United States -- not only low-tax but also low-wage, and of course no unions.

Maybe that strategy is OK for Bangladesh, but touting oneself as low-wage is not a long-term winning strategy for the US of A.  Lower wages and incomes mean a lower tax base, leading to poorer schools, less infrastructure and hence weaker long-term economic growth.

Indeed, the poorest and most miserable U.S. states are located in the South.

Today’s South is boldly moving backward

By Nelson Lichtenstein

June 18, 2014 | Reuters

We used to call it the “New South.” That was the era after Reconstruction and before the Civil Rights laws — when the states of the old Confederacy seemed most determined to preserve a social and economic order that encouraged low-wage industrialization as they fought to maintain Jim Crow.

What was then distinctive about the South had almost as much to do with economic inequality as racial segregation. Between roughly 1877 and 1965, the region was marked by low-wages, little government, short lives and lousy health — not just for African-Americans but for white workers and farmers.

The Civil Rights revolution and the rise of an economically dynamic Sun Belt in the 1970s and ‘80s seemed to end that oppressive and insular era. The Research Triangle in North Carolina, for example, has more in common with California’s Silicon Valley than with Rust Belt manufacturing. The distinctive American region known as the South had truly begun to vanish.

This is the thesis of economic historian Gavin Wright’s new book on the economic consequences of the civil rights revolution,Sharing the Prize. Ending segregation, Wright argues, improved the economic and social status of both white and black workers The South became far less distinctive as wages and government-provided benefits increased to roughly the national level.

But the New South has returned with a vengeance, led by a ruling white caste now putting in place policies likely to create a vast economic and social gap between most Southern states and those in the North, upper Midwest and Pacific region. As in the late 19th century, the Southern elite appears to believe that the only way their region can persuade companies to relocate there is by taking the low road: keeping wages down and social benefits skimpy. They seem to regard any trade union as the vanguard of a Northern army of occupation.  

Exhibit A is the refusal of every Southern state except Kentucky and Arkansas to expand Medicaid under the Affordable Care Act. Senator David Vitter (R-La.), running to replace Bobby Jindal as Louisiana’s governor, made headlines Monday when he announced he would consider adopting the Medicaid expansion.

In 2012 the Supreme Court gave states the right to back out of this part of Obamacare. The South rushed to take this opportunity — despite the loss of billions in federal dollars. Now 5 million poor Southerners are consigned to health insurance purgatory. 

The Republican Party as a whole has made opposition to Obamacare virtually a fetish. But outside the South, Republican governors from Arizona and Nevada in the West to Iowa, Ohio, and New Jersey further East, have seen the economic logic and social utility of taking the federal money. After the 2014 elections, when Democrats look likely to oust Republicans from statehouses in Pennsylvania and Maine, those states will do the same. 

Southern states also keep wages low by neglecting to raise their state minimum wage standards. In the North and West, a movement to dramatically increase wages — to $10, $12 or even $15 dollars an hour — has caught fire. Seattle just mandated a $15 minimum wage that will kick in over the next few years.

Today 21 states have raised minimum wages higher than that of the federal standard of $7.25 an hour. But only two of these states, Missouri and Florida, border on the South.  As in the New South era, when textile factories were enticed to flee the North for the low-wage Piedmont region, Southern states now trumpet not just low taxes and an absence of trade unions, but low wages.

Although Oklahoma joined the Union in 1907, it immediately joined the ranks of the Jim Crow South with its strong segregation and anti-union policies. This continues today. In April, for example, when Oklahoma City residents sought to put a municipal wage increase on the November ballot, the state legislature quickly enacted a law banning any city or town from raising the local minimum wage or requiring that employees have a right to sick days or vacation, either paid or unpaid.

Of course, such regressive social policies, including voting rights limitations, are supported by a fierce white partisanship. The solid South has returned in full force. Black voters there are overwhelmingly Democratic, whites of almost every income level equally determined to vote Republican.

The presence of an African-American in the White House plays a large role in this racial-political polarization on the ground in Dixie. But not even Southern-born white Democrats, like former President Bill Clinton and former Vice President Al Gore, have been able to transcend this Southern partisanship. Despite for their cultural affinities and Southern accents, they could not persuade Southern whites to vote Democratic.

This is, however, not just a product of racial fears and resentments. Instead it appears to reflect an increasingly inbred Southern hostility to the exercise of economic regulatory power on virtually any level.  As in the 19th century, many in the South, including a considerable proportion of the white working-class, have been persuaded that the federal government is their enemy.   

As in the New South era, Southern whites, both elite and plebian, have adopted an insular and defensive posture toward the rest of the nation and toward newcomers in their own region. Echoing the Jim Crow election laws promulgated by Southern states at the turn of the 20th century, the new wave of 21st century voting restrictions promise to sharply curb the Southern franchise, white, black, and brown.

The new New South rejects not only the cosmopolitanism of a multiracial, religiously pluralist society, but the legitimacy of government, both federal and state, that seeks to ameliorate the poverty and inequality that has been a hallmark of Southern distinctiveness for more than two centuries.

The Civil War has yet to be won.

Dem congressmen's hypocrisy on minimum wage

Seldom do I quote the far-right Daily Caller, much less agree with it, but never say never. (HT: AL).  

I tells it like it is, and lets the chips fall where they may. Check it [emphasis mine]:

According to a new study by the Employment Policies Institute (EPI), only four percent of the 210 lawmakers who pledged their allegiance to a bill raising the minimum wage pay their interns.

The Fair Minimum Wage Act would increase the federal minimum wage from $7.25 an hour to $10.10 an hour. EPI found that 96 percent of its House and Senate supporters give their interns a minimum wage of zero.

For shame, my liberal comrades!  

Seriously though, I've written before about the institutional elitism of unpaid professional internships. There ought to be a law against them, except in very special circumstances.  If something is worth doing, it's worth paying for; if it's worth paying for, then unpaid interns shouldn't be allowed to do it. They displace people who are looking for jobs but can't afford to work for free.  

Why is it elitist, you ask?  Because only young interns from well-off families can afford to work for free on Capitol Hill to gather up DC connections and pad their resumes.  

Report: Minimum wage hike backers rarely pay interns

By Breanna Deutsch

January 26, 2014 | The Daily Caller 

URL: http://dailycaller.com/2014/01/26/report-minimum-wage-hike-backers-rarely-pay-interns/#ixzz2rblSciKn

$10 minimum wage would raise 4.6 million from poverty without 'welfare'

This is what I, a liberal and an empiricist, am here for: to point out when experience and facts have settled an issue, and we don't need to have Left-Right arguments about it anymore.  The positive effect of raising the minimum wage to $10 is another "case closed" -- it's no longer a matter of opinion or economic theory -- as Mike Konczal at Wonkblog points out:

[R]aising the minimum wage to $10.10 an hour, as many Democrats are proposing in 2014, would reduce the number of people living in poverty by 4.6 million. It would also boost the incomes of those at the 10th percentile by $1,700. That’s a significant increase in the quality of life for our worst off that doesn’t require the government to tax and spend a single additional dollar.

This is not based on one study, but 12 major studies since the 1990s. Indeed, over the years, as some states raised the minimum wage and others did not, economists have been able to observe the contrasting effects of these controlled "experiments" with the minimum wage. Konczal sums up the evidence:

As many economists have argued, the minimum wage ”substantially ‘held up’ the lower tail of the U.S. earnings distribution” through the late 1970s, but this effect stopped as the real value of the minimum wage fell in subsequent decades. This gives us an empirical handle on how the minimum wage would help deal with both insufficient low-end wages and inequality, and the results are striking.

Economists agree: Raising the minimum wage reduces poverty

By Mike Konczal

January 4, 2014 | Washington Post

URL: http://wapo.st/19Hcgh6

Is Red Lobster an economic bellwether?

As you may recall, I'm a fan of Dead Lobster, (no snickering!), even though I've criticized Darden Restaurants (Red Lobster's owner) for trying in 2012 to cut back on employee hours to avoid giving them health insurance. Facing a 37 percent drop in revenue, Darden was apparently trying to scapegoat Obamacare for its restaurants' poor performance.

LZ Granderson sees ominous portents in Darden's plan announced late 2013 to spin off its 700 Red Lobster restaurants because they are losing money. He says this reflects poor and middle class families' shrinking wages and buying power. Especially black and Latino families.

My latest visit to Red Lobster was a bust: it was so busy that the wait time was one hour and 40 minutes. So my local Lobster seems to be doing OK.

At any rate, Granderson rightly laments the U.S. working class's 30-year fall from prosperity:

From November 2012 to November 2013, weekly earnings rose 1.1% while the consumer price index increased 1.2%, according to the Bureau of Labor Statistics. That small uptick may not seem like much until you factor in three years ago, wages increased 1.8%, and the CPI was up 3.5%. And that may not seem like much until you realize that almost every year since 1983, a series of small ticks like those two examples has been widening the gap between between what we earn and what we can buy.

Consider the poverty threshold.

For a family of four in 1983 it was $10,178. Adjusted for inflation, that should be $23,817.03 today. However, the actual 2013 poverty threshold is $23,492, a difference of $325.03.

When you're living check to check, that's a lot of money.

Indeed, a family of four can have a very nice meal at the Lobster for about 70-80 bucks. So $325 is about four trips to Red Lobster a year, now out of the picture. Or maybe it's money spent on something else, it doesn't really matter in macroeconomic terms. Multiply that $325 times 9.5 million poor households, and we're talking $3 billion in consumer demand sucked out of the U.S. economy. 

This is where the minimum wage, SNAP and unemployment benefits matter, because we have an economy built to serve the working poor and disappearing middle class, and if those people don't have income then businesses that cater to them will die, taking more jobs and income with them, in a vicious cycle. 

It's much easier to destroy than to create; and what's destroyed doesn't come back.

UPDATE (04.01.2014): Furthermore, Harvard economist Lawrence Katz recently estimated that the U.S. economy is losing $400 million to $1 billion every week  thanks to Republicans' decision to end long-term unemployment benefits for about 1.3 million Americans.

It hurts to lose Red Lobster, but money is tight

By LZ Granderson

January 1, 2014 | CNN

URL: http://www.cnn.com/2013/12/31/opinion/granderson-red-lobster/index.html?hpt=hp_bn7

Survey: U.S. workers suffer unprecedented anxiety

And it's all because of Obamacare and federal regulations.... Oh, and too-high taxes on corporations, can't forget that one.

Seriously though, Republicans are out of answers and Democrats are too pussy to do what's necessary, like expanding unemployment benefits, raising the minimum wage, expanding Social Security, offering real child care, etc.:

More than six in 10 workers in a recent Washington Post-Miller Center poll worry that they will lose their jobs to the economy, surpassing concerns in more than a dozen surveys dating to the 1970s. Nearly one in three, 32 percent, say they worry “a lot” about losing their jobs, also a record high, according to the joint survey, which explores Americans’ changing definition of success and their confidence in the country’s future. 

And this worry is especially strong among the working poor, aka the Little Guys:

Fifty-four percent of workers making $35,000 or less now worry “a lot” about losing their jobs, compared with 37 percent of ­lower-income workers in 1992 and an identical number in 1975, according to surveys by Time magazine, CNN and Yankelovich, a market research firm. Intense worry is far lower, 29 percent, among workers with incomes between $35,000 and $75,000, and it drops to 17 percent among those with incomes above that level.

Lower-paid workers also worry far more about making ends meet. Fully 85 percent of them fear that their families’ income will not be enough to meet expenses, up 25 points from a 1971 survey asking an identical question. Thirty-two percent say they worry all the time about meeting expenses, a number that has almost tripled since the 1970s.

And it's not even polite to talk about the health and social effects of such anxiety among the working poor, that often clouds their judgment and leads to depression. We haven't even attempted, as a society, to feel that level of empathy with our fellow Americans.

Among American workers, poll finds unprecedented anxiety about jobs, economy

By Jim Tankersley and Scott Clement

November 26, 2013 | Washington Post

URL: http://wapo.st/1evjLGj

'McJobs' lead to middle class?!

Never say I don't give equal time. To wit, here's the chairman of the National Restaurant Association Phil Hickey carrying water (er, super-size soda?) for America's "McJobs" creators:

The truth is that both part-time and full-time positions make the restaurant industry a versatile career option for a variety of workers. From underemployed or hard-to-employ workers to college graduates, the industry provides a pathway to the middle class and often beyond.

Efforts to devalue the industry and mandate changes, like raising the minimum wage, hurt workers by preventing businesses of all sizes from creating more jobs.

Hickey argues that the $7.25 federal minimum wage doesn't need to be raised because... hardly anybody earns minimum wage:

According to the Bureau of Labor Statistics, 71% of minimum-wage employees in the restaurant industry are under the age of 25; 47% are teenagers.  

So why is Hickey wrong?  First, Hickey is actually admitting that 53 percent of fast-food workers earning minimum wage are adults.  He is also admitting, indirectly, that the current minimum wage sucks and people don't deserve it.

In fact, according to USA Today, the average non-management fast-food employee currently earns $9.09 per hour or $18,886 per year. Though that is still below the 2013 federal poverty threshold of $19,530 for a family of three.

Moreover, "Eighty-eight percent of workers in jobs paying less than $10 an hour are older than 20, and a third are older than 40, according to the Economic Policy Institute."  

Granted, two adults working full-time in fast food could make for a (barely) middle-class household... but don't forget that most fast food joints don't offer their employees health insurance or other benefits. BTW, who's taking care of their kid(s)? And if a family is paying its health costs out of pocket without insurance then God help them, because one medical emergency could bankrupt them. As indeed will happen to 2 million Americans this year. 

And if a family of three elects to buy health insurance on their own, either HSA or HDHP, then chances are their annual deductible + monthly costs will be $10,000 and up, or about 1/3 of that fast-food family's gross income.  

Next fact: in the U.S., workers' wages make up 25 to 35 percent of the cost of fast food, according to experts. Meanwhile, the norm in Europe where the minimum wage is higher is about 45 percent; and yet somehow, McDonald's manages to operate more than 7,400 restaurants in Europe. This indicates there is room for higher U.S. wages.  Still, the cost of fast food would probably go up, since restaurant owners, whose average profit margins hover around 4 percent, would pass on all or most of a wage increase to customers. 

"That's terrible, higher prices must be avoided at all costs!" my conservative interlocutor will object. To them inflation is the biggest bogeyman next to taxes. But you know what? I'm cool with it.  Poorer people would do well to eat less fast food anyway, and prepare their own meals; and wealthier people could afford to pay a little more. 

It reminds me how "Papa" John Schnatter warned in dire terms that Papa John's restaurants would have to raise their prices 14 cents per pizza to give their employees health insurance to comply with Obamacare. But what's 14 cents to a customer who can afford to buy a pizza instead of groceries? Plus it's customary to tip the deliver guy at least a couple bucks.

(BTW, President Obama's proposal in February to raise the minimum wage to $9 and tie it to the cost of living was projected to raise the price of fast food 3 percent. With a $9 minimum wage, the average cost of a McDonald's Extra Value Meal would then increase from $4.45 to $4.58.  Hardly noticeable.  Doing a little algebra -- although I have no idea if this is economically sound -- at the same ratio, a $15 minimum wage would increase the cost of fast food by 13.3 percent, for a Value Meal price of $5.03.  Heck, let's suppose a $15 wage would raise the price 40 percent: the Value Meal would still cost only $6.23.  Not exactly hyperinflation.)

According to economic theory, there is a big benefit to higher wages: lower employee turnover. Lower turnover leads to higher productivity (output per employee per hour). U.S. workers, incidentally, are already the most productive in the world, although you wouldn't guess it, considering real U.S. incomes have been stagnant since the 1970s; and the median male is especially worse off today, earning as much in real dollars as a man in 1964!

Next problem with Hickey's apologia: McDonald's, Walmart and most other retailers employ few full-time workers anyway; workers are not permitted to work full time.  So we're really talking about workers below the U.S. poverty line unless they work two part-time jobs.  That is, assuming they can get those part-time jobs: there are still 3 applicants for every job opening.

To protest this sad state of affairs, yesterday fast-food workers in about 60 U.S. cities carried out a one-day strike for a minimum hourly wage of $15.  

Theirs is the next great struggle for organized labor and fair compensation.  But it's not their struggle alone.  Even the middle and upper classes stand to lose -- or gain -- along with the lowest-paid Americans.  

"There is a spillover effect from raising the minimum wage, and those who are currently earning [just] above it will also benefit, as many employers will raise their wages too," said Lawrence Mishel of the Economic Policy Institute.

Furthermore, as entrepreneur Nick Hanauer explained in his Bloomberg op-ed, "The Capitalist’s Case for a $15 Minimum Wage": 

Raising the minimum wage to $15 an hour* would inject about $450 billion into the economy each year. That would give more purchasing power to millions of poor and lower-middle-class Americans, and would stimulate buying, production and hiring.

Studies by the Economic Policy Institute show that a $15 minimum wage would directly affect 51 million workers and indirectly benefit an additional 30 million. That’s 81 million people, or about 64 percent of the workforce, and their families who would be more able to buy cars, clothing and food from our nation’s businesses.

... [C]ontrary to conventional economic orthodoxy, increases in the minimum wage increase employment. In 60 percent of the states that raised the minimum wage during periods of high unemployment, job growth was faster than the national average.

Some business people oppose an increase in the minimum wage as needless government interference in the workings of the market. In fact, a big increase would substantially reduce government intervention and dependency on public assistance programs.

(*Here's yet more equal time for crusty conservatives, a very long argument why "A $15 minimum wage is a terrible idea" by Dylan Matthews over at WaPo's Wonkblog.)

Regardless of whether the new minimum wage should be $9 or a few bucks more, $7.25 'MCJobs' just aren't cutting it for our economy.  And 'McJobs' are certainly not "a pathway to the middle class and often beyond" -- not unless something changes.  

Eric Liu, a former speechwriter for Bill Clinton, summed it up best in his TIME piece, "McDonald’s and the Fate of the Middle Class":

Too many American think that the plight of the low-wage worker has nothing to do with them. In fact it is both a preview and a parable. The fate of the middle class rests, in part, on whether more Americans learn to see the fate of fry cooks as their own.

We must all rise or fall together!

Eskrow: Where did U.S. wages go?

Here's Eskrow's key observation, one that you cannot even make nowadays in America without being accused of a socialist bent [emphasis mine]:

We don't have a problem of inadequate wealth. The problem is inadequate wealth distribution. For 99 percent of Americans, wage growth has lagged significantly behind increases in productivity. As the authors [of the briefing paper "A Decade of Flat Wages"] note, this is true "regardless of occupation, gender, race/ethnicity, or education level." Since the Great Recession productivity has grown by 7.7 percent, while wages have actually fallen for the bottom 70 percent of earners.

[...] Between 2001 and 2012 productivity grew by 22.2 percent, while wages grew only 0.8 percent. 

My Republican friends, take special note of the phrase, "...regardless of occupation, gender, race/ethnicity or education level."  This phrase should stifle your knee-jerk reactions to blame those other people for America's economic woes.

So the facts are indisputable.  The question is: what are the causes? Eskrow points out a few:

A companion report from EPI, The State of Working America, 12th Edition, identifies some of the causes: Growing inequality. Policy inaction which eroded the value of the minimum wage. The weakening of employees' rights. Tax policy. Wall Street deregulation.

Other factors are left unmentioned, including problems in corporate governance and the distorting effect of changing executive compensation on corporate management practices.

Eskrow also blames another cause: "centrist" Democrats, aka 1990s-era Republicans who today call themselves Democrats: 

The word "centrist" is placed in quotation marks because polls show that their economic views are to the right of the American mainstream. On issues such as corporate taxation, Social Security benefits, and free trade, they stand to the right of most Americans -- and sometimes to the right of most registered Republicans.

Forget Republicans in Congress, they're nuts.  We need Democrats to be Democrats again, grow a spine, or get out of office.

Where Have America's Wages Gone?

By Richard (RJ) Eskrow

August 28, 2013 | Huffington Post

URL: http://huff.to/1ds6Asl

It's about total compensation

Today it's a three-fer, since each story is about the same thing: the consequences of low U.S. wages and the absence of benefits.

First, my man Harold Meyerson notes that low wages paid by big retailers and fast-food joints are now hurting big retailers and fast-food joints, because low-paid workers don't have money to buy stuff.  (Duh).  Furthermore, Meyerson makes the interesting observation that we've gone back to the pre-WWII era, before big retailers like Federated and Macy's actively backed New Deal-era reforms like the minimum wage, unemployment insurance, 5-day workweek, unions, and co-op banks. Back then, businessmen understood that a healthy middle class was in their own best interest. 

It seems we've forgotten, once again, what actually makes America go. (I blame this all on the historically amnesiac Tea Parties, who don't care about anything that happened in America between 1789 and 1980.)

Next, Heidi Moore reminds us that our recent focus on the minimum wage, while correct, actually obscures the key issue: total compensation.  Wages could theoretically stay flat, but if more employers were to offer health insurance, paid sick leave, vacation and a retirement plan, then wages wouldn't need to be as high.    

Moore also observes that low total compensation, historically speaking, has put a record-high strain on government poverty programs such as food stamps. So, with corporate profits at an all-time high and compensation at an all-time low, welfare becomes a subsidy for Big Business.  (Wal-Mart has long been the national poster child for forcing its employees to go on welfare).

Finally, Sarah Kendzior points out that the feminist debate over whether women should work or stay at home is all rather quaint, considering that women, just like everybody else, make such decisions based on hard economic realities. Paradoxically, due to the high cost of child care, it is often cheaper for a woman to stay at home rather than work; yet staying at home allows her skills to degrade, or at the very least carries a stigma with potential employers when she tries to re-enter the workforce. Educated, qualified women excluded from our workforce reduces our nation's overall productivity. 

So once again, the answer is for Big Government to step in and mandate paternity leave, provide free or subsidized daycare, and make giving birth at a hospital cheaper, so that young families don't start off in debt.  Because the free market has failed to address these failures.

For retailers, low wages aren’t working out

By Harold Meyerson

August 21, 2013 | Washington Post

URL: http://wapo.st/181Hg41

How low can you get: the minimum wage scam

By Heidi Moore

August 20, 2013 | Guardian

URL: http://gu.com/p/3t625

Mothers are not 'opting out' - they are out of options

By Sarah Kendzior

August 19, 2013 | Al Jazeera

URL: http://www.aljazeera.com/indepth/opinion/2013/08/201381615448464851.html

No accident U.S. is most unequal

I'll continue to hammer away at America's growing wealth inequality that is here by design, not by accident. What do I mean? 

One the one hand, we have government policies that help out the rich: the tax code (that gives U.S. corporations an effective tax rate lower than any official rate among G-20 countries, encourages overseas outsourcing and offshoring of income, favors capital gains and executive stock options over wages, protects 401-k and IRAs for rich people who save anyway, and has dramatically lowered inheritance tax over the past 30 years); deregulation of banking combined with the $30 trillion TBTF bank bailouts; deregulation of health, safety and environmental codes; fraudulent H1B visas that displace U.S. workers to cut corporate costs; and allowing more money -- and more independent money -- into our elections.  

One the other hand, we have government policies that hurt workers and the poor: a regressive tax system that targets workers; Social Security cuts; laws against unions; public transportation fee hikes and service cuts; public employment cuts; public education cuts; falling real minimum wage; and exploding student debt that is immune from personal bankruptcy.

Some anti-worker policies are well-intended. For example, cities often seek to outbid each other with ever-growing subsidies and tax breaks to attract large retailers that promise job creation... with the unintended effect of ruining local mom-and-pop businesses that used to offer better wages and benefits -- wages and benefits that never come back -- and degrading their local tax base.  

We Democrats and liberals can't ignore inequality or its root causes and hope they go away, or fear accusations of "class warfare" for our speaking out. Class warfare is already being waged against the poor and working class, whether we admit it or not.

The U.S. Has The Worst Income Inequality In The Developed World, Thanks To Wall Street: Study

By Mark Gongloff

August 15, 2013 | Huffington Post

Hey, who says America is in decline? The U.S. is still more awesome than the rest of the world at making at least one thing. And that thing is income inequality.

A new paper by economists Facundo Alvaredo, Anthony B. Atkinson, Thomas Piketty, and Emmanuel Saez lays out just how much better at making inequality the U.S. is than everybody else and tries to explain how it got that way.

Since the 1970s, the top 1 percent of earners in the U.S. has roughly doubled its share of the total American income pie to nearly 20 percent from about 10 percent, according to the paper. This gain is easily the biggest among other developed countries, the researchers note. You can see this in the chart below, taken from the paper, which maps the income gains of the top 1 percent in several countries against the massive tax breaks most of them have gotten in the past several decades. (Story continues after chart.)

The higher the dot, the more income inequality has grown in that country. See the red dot waaaay up in the left-hand corner, far away from everybody else? That is the United States, where the top earners have made more while getting their taxes slashed by over 40 percent.

This echoes an OECD study from earlier this year that found the U.S. had the highest income inequality in the developed world. It followed only Chile, Mexico and Turkey among all nations.

So how did America get so darn great at ratcheting open the chasm between the haves and have-nots? Thank the dynamic duo of Wall Street and Washington, which have been working so well together for the past few decades to make laws that favor banks. Turns out this Axis Of Making It Rain has also been making laws that favor the exorbitantly wealthy. Win-win. Unless you are poor, in which case: Sorry, be born to richer parentsnext time, maybe?

One thing you'll notice in this chart is that, typically, the bigger the tax cuts given to the 1 percent (the horizontal scale on the chart), the bigger the income inequality. This is consistent with other studies that have shown the tax code has a big effect on income distribution. That's one way Washington has boosted inequality: By slashing taxes on the rich, for freedom and growth and trickling down on the poor. Unfortunately, the paper points out, contrary to what you will hear from conservatives, lower tax rates on the wealthy offer no obvious benefits to growth, or to the poor.

One other thing you'll notice from the chart is that the United Kingdom has slashed taxes on the top 1 percent almost as aggressively the U.S. has, and yet the share of income going to the top 1 percent is not nearly as big. So there's something else going on here besides just tax breaks.

That something is Wall Street, more or less, as Matthew O'Brien of The Atlantic points out. The same politicians that have busily been slashing taxes on the wealthy have also been loosening fetters on banking, allowing the financial sector to swell to bloated size and mop up ever-more income while contributing ever-less back to the economy. Again, this is consistent with other studies that have attributed much of the rise in in inequality to the pay being sucked up by bankers and overpaid CEOs.

At the same time, U.S. lawmakers have also made it easier and more tax-friendly for the wealthy to pile up more capital gains on their investments. As O'Brien puts it, "The top 1 percent leveraged itself to the market, and haven't looked back."

One nifty benefit to having nine metric craptons of money is that you can use it to buy politicians to help you craft the laws you like, particularly those that will help you end up with 10 metric craptons of money. The poor and middle class, meanwhile, just get ever more discouraged about the political system and stop bothering to fight it, increasingly turning the whole process over to the wealthy and the politicians they own, according to arecent paper by Frederick Solt at Southern Illinois University. Sound familiar?