Tuesday, August 26, 2014

Tuesday, August 19, 2014

It is getting much harder to earn big bucks in America, my new analysis of official wage data shows.
The number of workers making $2 million or more per year declined almost 5 percent, from 39,650 in 2000 to 37,714 in 2012. This decline is especially remarkable, given 11 percent population growth.
These top jobs paid less too, despite 22 percent real growth in the economy over those 12 years. Measured in 2012 dollars, average pay at the top was $5.04 million, down from $5.27 million in 2000. That’s 4.3 percent less pay per top worker.
Combined, the decline in big bucks jobs and average pay meant top earners got a smaller slice of the national wage pie. The pie grew 7.2 percent. But the $2 million and up workers saw their slice shrink from 3.4 percent to 2.9 percent.
Now why should the typical worker care about this trifecta of bad news for high earners? After all, just one worker in about 4,100 makes this kind of money. What does it possibly matter to ordinary Americans that bosses who make as much in a year as they may earn for a lifetime of labor are squeezed a bit?
It matters because falling pay at the top can become a powerful tool for change. U.S. representatives and senators may not care much what a typical constituent thinks, but they do care about what the highest-paid Americans think, because they donate to campaigns.
If those at the top come to see that they share the travails of most other Americans, it increases the prospect of government policy changes that will grow our economy. We need to invest in the future of America for our economy can grow, which will make everyone, from custodians to CEOs, better off.

Up or down together

This is a story about the income of high earners. Income and wealth are not the same. Wealth is property — assets, from stocks and land to fine art. Income is earnings, primarily from work. Assets are soaring in value, but not paychecks.
The declines in inflation-adjusted top pay show that workers are all in this together, rich and poor — a lesson President Theodore Roosevelt taught as he fought for policies that helped create America’s middle class and a century of prosperity. We need to inject his wise words into our civic debate.
“The fundamental rule in our national life — the rule which underlies all others — is that, on the whole and in the long run, we shall go up or down together,” he told Congress in 1901. 
Let’s talk about how overall, U.S. workers earn less today than they did in 2000.
By cutting investments in the future of America, Congress is making us worse off than need be. Spending more on basic research, on fixing up and improving our infrastructure and investing in higher education will more than pay for itself today and make us all richer in the future.
The mentality that taxes rob us holds America back. On the contrary, tax dollars can enrich everyone — a core idea that the Constitution’s framers knew and taught but that we have forgotten, along with Roosevelt’s insight.
The eye-opening figures on the earnings of those making $2 million or more come from the most comprehensive, precise and reliable source of income data in the U.S. It covers just one component of the money people receive — wages and salaries — but that explains roughly 70 cents out of each dollar of total individual income.
W-2 forms show wages, salaries, overtime, bonuses and profits from stock options, which are taxed as cash wages. Most fringe benefits are excluded from this data, meaning it provides an excellent though not quite perfect measure of cash compensation. When it comes to people’s sense of financial security and freedom to save or spend as they choose, it is cash income that matters the most.
Employers send W-2 forms to their workers and to the Social Security Administration. Social Security then adds the W-2s down to the penny and each year breaks them into fine categories, as small as $5,000 brackets, with a top bracket of $50 million or more.

What the data show

My column last week showed, using this data, that over the same 12 years the lowest-paid workers in the United States got a real pay increase while those making $20,000 to $40,000 in 2012 dollars saw their average pay dip slightly. The under-$20,000 workers enjoyed a small real average increase in pay because of three minimum wage hikes promoted by Democrats and passed with votes from 82 House Republicans and all but four Senate Republicans. President George W. Bush signed the hikes into law.
Social Security issues finely detailed breakdowns of wages by income brackets, but the brackets are fixed, which typically means that inflation adjustment of the same income groups is not possible. But since 2012 prices were exactly a third higher than in 2000, we can make some comparisons using inflation-adjusted dollars.
The wage bracket from $1.5 million to $3 million in 2000 is equivalent to the $2 million to $4 million bracket in 2012. And that means we can also look at jobs paying $4 million or more. Here in the rarified air of the top earners, something really interesting took place.
First, consider those making $2 million to $4 million: Their numbers plummeted, down 41 percent, from the 29,866 such workers in 2000 to 17,750 in 2012. Their average pay fell too, from $3 million in 2000 to $2.4 million in 2012.
For workers paid $4 million or more, the story is nuanced. Their ranks more than doubled — from 9,784 in 2000 to 20,164 a dozen years later. But their average pay plummeted by $4.7 million — a 39.2 percent decline. Average pay was $12 million in 2000 but $7.3 million in 2012.
Consequently, the highest of the very highly paid are dominating, yet they are not being paid nearly as well as their 2000 counterparts, probably because of smaller profits from exercising stock options.
These shrinking jobs and pay figures, together with those reported in last week’s column, should transform our debate about pay. The data demonstrate that the bottom two-thirds of workers and the highest paid few have a common cause in seeking pay raises.
Let’s start talking differently about our economy. Let’s talk about how overall, U.S. workers earn less today than they did in 2000. Let’s talk about how to get America a pay raise, both for workers paid under $40,000 and those paid than $2 million. Let’s talk about how all workers are in this together.
David Cay Johnston, an investigative reporter who won a Pulitzer Prize while at The New York Times, teaches business, tax and property law of the ancient world at the Syracuse University College of Law. He is the best-selling author of “Perfectly Legal,” “Free Lunch” and “The Fine Print” and editor of the new anthology “Divided: The Perils of Our Growing Inequality.”
The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera America's editorial policy.
An extraordinary shift in wages paid to American workers took place from 2000 to 2012, a change that holds powerful lessons about the minimum wage, government policy and unions.
The lowest-paid workers — those making less than $20,000 a year — saw their average pay rise by more than the rate of inflation. There were nearly 61 million workers in this group in 2012, and they averaged $8,255 in wages annually. Compared with the year 2000, that was a real increase of $95, or 1.2 percent.
That’s not much, but it’s better than what happened to workers just above them, those earning $20,000 to $40,000. Their 2012 average wage slipped a tad, down $104, to $29,420, from 2000.
Many factors are at work in this shift, but one appears crucial: minimum wage laws.
Workers at the bottom enjoyed on average a real pay raise despite a surplus of unemployed people and a weak economy. These bottom-of-the-wage-ladder workers, generally unrepresented by unions, are powerless.
But government can be a proxy for unions. In this case the wage hike was signed by none other than President George W. Bush, helped by 82 House Republicans and all but four Senate Republicans.
In 2007, Bush signed into law increases in the minimum wage that took effect in 2007, 2008 and 2009. Each raised the minimum by 70 cents, lifting it to $7.25 an hour. Before Bush signed the increases into law, minimum wage workers had gone a decade with no increase. By 2007, inflation had reduced the value of their hourly pay to 77 cents on the 1997 dollar.
Commentators often note how inflation robs retirees on fixed incomes, but less frequently about how it ravages the pocketbooks of the lowest-paid workers, many of whom then turn to the government for food stamps, medical care and other costs that society must bear.
Because of Bush’s signature, the 2012 minimum wage was 40 percent higher than in 2000. That is significantly more than the 33 percent increase in prices caused by inflation over those dozen years.
Typically such comparisons cannot be made because the federal government reports most data by fixed income categories, which are not adjusted for inflation.
But while reviewing wage statistics published on the Social Security Administration website, I recalled a delightfully convenient fact from the Bureau of Labor Statistics inflation tables: To adjust 2000 prices to 2012, you multiply by 1.333. That means  $15,000 in the year 2000 is equivalent to $20,000 in 2012.
That meant, in turn, that I could compare workers making under $15,000 in 2000 with those making $20,000 in 2012. The same is true for $30,000 to $40,000, and for $75,000 to $100,000 and so on, as long as the 2012 category is a third higher.
Higher pay draws more people into the labor market, and it means workers have more to spend on goods and services, which creates more demand to hire more workers as well as generating more profits for business owners.
However, there is no comparable way to assess workers at $50,000 in 2000, for example, with those at $66,666 in 2012, because no such category exists in the official data.
Still, this analysis covers a huge swath of workers. In 2012 nearly 61 million workers, or 39 percent of the workforce, made less than $20,000. In 2000 almost exactly the same share of the workforce made $15,000 or less.
Only a minority of these lowest-paid workers earned the minimum wage. But those who made up to about $2 an hour above the minimum also benefited from its increase, as their pay also rose because of what labor economists call the spillover effect, one of the best-documented and most studied areas of how minimum wage increases affect the economy. Raising the minimum wage in steps until it reaches $15 in today’s money would benefit workers making as much as $20 an hour because of this spillover effect.
To understand the concept, imagine you are a minimum wage worker and get promoted to shift supervisor. Your added responsibilities bring an extra 50 cents an hour.
Then Congress and the president raise the minimum wage by 50 cents. To maintain that premium for your added responsibilities, your employer will raise your wage by the mandated amount and may even bump it by a bit more, say 55 cents extra an hour.
When I was a 17-year-old minimum wage worker, the absentee owner of a Baskin-Robbins franchise promoted me to store manager and gave me a desperately appreciated extra 15 cents per hour. Then the federal minimum wage rose by 15 cents, and the owner said the crew would get the same as me — until I started to untie my apron, at which point he agreed to retain my 15-cent-an-hour premium.
And how did the franchise cover the cost of the higher wages? I tried to make store operations more efficient to shave costs, and the owner raised the price of a single scoop by a penny, to 11 cents. That increase was a little less than the 12 percent hike in the minimum wage. We suffered no loss of customers.
Spillover effects weaken the farther one’s pay is above the minimum. For a worker making $15 an hour, the spillover effect from increasing the minimum wage is essentially zero.
But the spillover effect still benefits a large number of workers. Consider someone who works 50 weeks at $15 an hour, or $30,000 a year. More than half of U.S. workers — 53 percent in 2012 — make $30,000 or less. Consequently, if cities, counties, states and Uncle Sam raise the minimum wage in steps until it is $15 in today’s dollars, the spillover would improve the pay of the almost 2 out of 3 workers who make less than $20 an hour.
There is no free lunch, of course. But neither economics nor higher pay is a zero-sum game, as opponents of the minimum wage often assume. Higher pay draws more people into the labor market, and it means workers have more to spend on goods and services, which creates more demand to hire more workers as well as generating more profits for business owners. It also means less demand for food stamps and other government benefits, easing taxpayer burdens, even as prices rise a bit to cover higher labor costs.
Seven years ago, a Republican president who famously said his base was “the haves and the have-mores” signed into law a raise for the lowest-paid workers. In the House of Representatives, 82 Republicans voted to raise the minimum wage. That kind of bipartisanship today would do America a lot of good.
Average wages, 2000 and 2012

Average wages for workers making $1k-$20k and $20k-$40k

Total wages, 2000 and 2012

Total wages for workers making $1k-$20k and $20k-$40k

David Cay Johnston, an investigative reporter who won a Pulitzer Prize while at The New York Times, teaches business, tax and property law of the ancient world at the Syracuse University College of Law. He is the best-selling author of “Perfectly Legal,” “Free Lunch” and “The Fine Print” and editor of the new anthology “Divided: The Perils of Our Growing Inequality.”
The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera America's editorial policy.

min to ave....min to med various oecders

are we close to there yet ?

. "There" is to  "full employment."

regardez the hacks from FED Atlanta

"...observers cite in defense of an approaching full-employment and growing wage pressures is the following chart. It shows a rather strong correlation between survey data from the National Federation of Independent Business (NFIB) on the proportion of firms planning to raise worker compensation over the next three months and lagged wage and salary growth (see the chart).
Businesses' Response to Tightening Job Market
  "......if you are looking for a sign of impending wage pressure, the chart above certainly looks compelling. Well, except that a pretty large gap has opened up between the behavior of the NFIB survey data and the actual growth trend in compensation since 2011. "

. But

".... our survey data aren't showing the same rise in compensation expectations that we see in the NFIB survey data (see the tables). "
Firm's Compensation Expectations

" Our survey data are not directly comparable to the NFIB since the NFIB survey asks firms about their plans during the next three months, and we ask about plans during the coming 12 months."

"Moreover, the NFIB surveys small businesses—roughly 75 percent of the businesses in the NFIB survey employ fewer than 20 workers, and about 60 percent employ fewer than 10.  "

". The first observation we note is that as the size of the firm shrinks, so does the proportion of small firms planning to increase wages. "

"This result isn't especially surprising since the small firms in our panel report considerably worse prevailing business conditions than do the large firms"

money line:.

" On net in August, 53 percent of the firms that employ fewer than 20 workers expect to raise worker compensation during the next 12 months. ..."

"That percent is down
from 69 percent of similarly sized firms in May 2013. "  !!!!!!!!!!!!!!!!!

"Further, the average amount that firms expect to increase wages (2.7 percent) is also about unchanged from 15 months ago (2.8 percent), and this result is rather consistent by firm size and industry."

" If anything, our panel of businesses reports less expected compensation pressure in the year ahead than when we last asked them in May 2013"


"  maybe this is missing the big point of the figure that kicked off this post."

"Since about 2011, there appears to be a growing discrepancy between the recent trend in the NFIB survey on compensation increases and actual compensation increases."

 ". Correlation is different than causation, and many correlations coming from the labor market in recent years appear to be deviating from their historical norms. Isn't that the takeaway of the two earlier macroblog posts? "

"We're not brave enough to say that we know for certain that the economy isn't on the verge of an accelerated pace of compensation growth. But, if we were brave enough, we'd say our survey data indicate that such acceleration is unlikely. "

the zany faux chicken shit authorian  trio

Photo of Mike Bryan
Photo of Brent Meyer
Photo of Nicholas Parker

ECON CON ; a radically historical science ...enter Agent Based Models

The GE paradigm
Despite polite deference
is hanging by its finger nails

And has been for decades
The academy needs to pursue ABM
In fact I'd scrap the whole dsge Rat ex single rep agent paradigm
It reminds me of string theory
Neither has advanced our knowledge after 40 years of clever elaborations
Yet both may well have served a number of preliminary preporatory purposes
Both positive and negative
That may well have been required in some sterile form
Prior to the arrival of a fertile form of ABM

the task

Recall rugged long lived paradigms
fail for lack of internal consistency

Once abandoned by the community
of orthodox experts
a paradigm simply stagnates
Its ability to self expand
to innovate
To push out the depth and breadth
of its coverage
is simply not tested anymore
clever thinkers
".... in theory .. robustness is key"
not always
epicycles can produce any pattern of celestial motions one might observe
but that paradigm after a nice run was abandoned
similarly the celestial aether was abandoned
as the4 ultimat6e stuff
only to re appear as the sub planck scale
stuff of M theory
these metaphysical postulations are endless
they never die
only the community
that hatches and nurtures them die
Euclidian immortality
locus paleoclassicus Semiticium
the first book of Moses
Quality control?
Sim science
Is about causal story lines
Like natural evolution
sim science is radically
history based
economics is a radically historical science like natural evolution

look at nippon

Sunday, August 3, 2014

pretty poison "“protect workers, not jobs" and hank C

protect scarce jobs  or
dole out to the job less

macro job rationing leads to this "trade off "

heat up job markets till
the Chinaski effect
 is visible in the turnover numbers


constant wages boom pressure

rehire is near instantaneous

Saturday, August 2, 2014

"good krugman ....good krugman.....but "

comes the big contraction  in 1929  and ....

"....Wages fell as the economy was slumping, but bounced back thereafter even though unemployment was high"

". Applying modern arguments to these data one could easily have concluded
that the economy was near capacity in, say, 1939..."

"..... in fact many economists argued at the time that most unemployment was structural, due to the mismatch between skills and the requirements of the modern economy, and could not be cured with more demand."

"But then came massive fiscal stimulus in the form of rearmament and war — and it turned out that there was plenty of slack in the economy, and American workers were just fine."

yup no structural unemployment
come war
full job force remobilization...

and then sum
plenty sum

 riviters out of Roses

 only required adequate spending ...

but notice post  jan  1936 wages go on a second boomer until  pole axed

does wage rate control
trump full remobilization of the potential job force ?

what else  led to this macro policy contrived
   sharp and deep re-contraction

this is the episode most like the recent stunted recovery

the beveridge path


dated over view but ....

say job separations (S) and hires (H)
 run around  9 % of employed quarterly
and job  destructions(D) and creations  (C) 3.5 %

averaged over the cycle



more on "zero real"

" real interest rates are expected to be only slightly above growth rates. "
that is a usual way to tip toe past
the  bug a boo of a debt trap

the trap ?

pk again :
"It’s true that if current policies are continued with no change
 we’re highly likely to face an unsustainable fiscal gap"

" ...a gap that can’t go on forever ..."

" if we look far enough..."  ahead . Stein’s Law  applies:

" if something can’t go on forever, it will stop"

". Sooner or later,
 we will have some combination
                               of benefits cuts and/or revenue increases"

yikes !!

but what nonsense !

 nothing prevents the FED from adopting
a "zero real " infinite horizon "safe"
interest rate policy
nothing except ..... wall street
a zero real policy
would uncap public nominal debt
to support any necessary maximum mobilization macronautics
we would rely on
"the discretion
of the American people "
to govern fiscal deficits

"Russia's bumpy transition away from central planning ..." as told by tubby timmy


post gosplan declines wildly  understated ?

  no sez timbo

" The sharp declines in economic growth in the 1990s are probably overstated"

"... Russia's economic output in 1991 was inflated by all the peculiar practices of the earlier central planners"

, and

..." Russia's economic statistics for the 1990s
failed to capture much  of the unreported "underground" economy. "

can raw markets determine opportunity costs ? NOOOOOOH !!!

in macrotopia there will be NO DOLE !!!!!!!! NO DOLE !!!!!! NO DOLE !!!!!!!

zero real and the new macrotopia

stabilize the real long term safe rate at zero and with this the limitless vista of burdenless public spending opens up ahh but what of responsible governance by the people ?

Saturday, July 19, 2014

an auto moblizer : operating without a net

turn the safety net tax and transfer system into a mobilizer when FM is not spontaneous injected added demand thru jobbler households thru transfers from the earned dividend fund

Wednesday, July 16, 2014

Hymerizing PA ursprüngliche akkumulation

"The word primitive is here used in the sense of “belonging to the first age, period, or stage,” i.e., of being “original rather than derivative,” and not in the sense of “simple, rude, or rough.” Marx’s original term was “ursprüngliche akkumulation,” and as Paul Sweezy suggests, it would have been better translated as “original” or “primary” accumulation. But it is too late to change current usage, and the word primitive should be interpreted in a technical sense, as in mathematics, where a primitive line or figure is a line or figure “from which some construction or reckoning begins.” In economics primitive accumulation refers to the period from which capitalist accumulation springs. It was not simple, though it was rude and rough."

Tuesday, July 15, 2014

operating without a net

this Thoma screed is solid safety net progressive thought but we need perpetual full employment ...no ? I suggest we push a tax and transfer system that can operate without a net using earned social dividends based on each citizens life time social security contributions

Monday, July 7, 2014


"The Mission of Socialism is Wide as the World": Speech at Chicago, Illinois -- July 4, 1901. Published in the Social Democratic Herald [Chicago], v. 4, no. 4, whole no. 158 (July 13, 1901), pp. 1, 4. "Ladies, Gentlemen, and Comrades: It is our good fortune, if we can boast, no other, to live in the most marvelous age of all the centuries, not contemplating the material progress of our time, which overwhelms and bewilders by its extraordinary achievements. Improvements have been accomplished as if by magic and we behold with wonder and awe the march of human conquest. The forces of nature which terrified primitive man, and before which the ancient world bent in superstition, have to a large extent been conquered and are the subject servants of man's desire. In this march of progress the brain and heart have been expanded, the one shedding light and the other life, without which civilization would turn back upon its axis. Fortunately for man, everything is subject to change, and all change tends to the development of the race and the advancement of human institutions. Institutions crumble in this march of time. All of were disregarded. They objected to taxation without representation. Their protests were scorned. Finally they revolted. They issued the Declaration of Independence and enunciated the proposition that men are created equal. But the founders of this republic had only vague conceptions of democracy. The working class as we understand it today were not represented in the Constitutional Convention. The founders of the republic in declaring that men were created equal evidently meant themselves alone. They did not include the negro, who had been brought here against his will and had been reduced to a state of abject slavery. The institution of chattel slavery was already securely established at that time. It was founded in iniquity, yet it did not seemingly disturb the consciences of the founders of the them have their periods of gestation, of birth, of development, maturity, decline, decay, and death. All of them come in their order. They fulfill their mission, they give birth to their offspring, and they pass away. A little over a century ago the inhabitants of this country were not citizens. They were ruled by a foreign king. They petitioned for relief. Their petitions republic. This institution was in conflict with the spirit of the Declaration, with the genius of free institutions, and yet it was incorporated in them. It steadily grew in power, and in course of time it controlled the country and the courts and the life of the people. On this day, commemorating the 4th of July, 1776, the Declaration of Independence was issued. Thousands of orators all over this broad land will glorify the institutions under which we live. In pride they will point toward Old Glory and declare that it is a flag that waves over a free country. In these modern days we hear very much about that flag and about the institutions over which it waves. I am not of those who worship the flag. I have no respect for the stars and stripes, or for any other flag that symbolizes slavery. It does not matter to me what others may think, say, or do. I propose to preserve the integrity of my soul. I will give you a transcript of my mind and tell you precisely what I think. Not very long ago the President of the country [William McKinley], in the attitude of mock heroics, asked who would haul down the flag. I will tell him. Triumphant Socialism will haul down that flag and every other that symbolizes capitalist class rule and wage slavery. I am a patriot, but in the sense that I love all countries. I love the sentiment of William L. Garrison: "All the world is my country and all mankind are my countrymen." Thomas Jefferson once said: "Where liberty is, is my country." That is good. Thomas Paine said: "Where liberty is honored, that is my country." That is better. Where liberty is not, Socialism has a mission, and, therefore, the mission of Socialism is as wide as the world. The framers of the Constitution of this country had no faith in the people. They did not suffer them to see the proceedings of the Convention. The insufferable institution of chattel slavery was compromised in the American Constitution. It was at this time a perfectly legal institution, but it was founded inn iniquity. It was doomed to finally disappear and the agitation against it began in a feeble way. Lovejoy was one of the pioneers of the revolt. He went to New England and then to Illinois, and with all the vigor of his intellect began to attack slavery. A committee called upon him. He said to them, "I can afford to die at my post, but I cannot afford to desert it." I take pride in paying to such a man the humble tribute of my gratitude and love. It is such men as he who have made it possible for me to enjoy some degree of liberty. I can only discharge my duty to him and to them to try to do something for those who are to come after me. In 1837 the mob took his office and destroyed it by fire, his printing press was thrown in the Mississippi River, and he was murdered. But to the greatest and noblest figure among those early pioneers was reserved the final act which culminated in the rule in which the institution of slavery disappeared from American soil. I need only mention his name, and although it is a very common one, you will at once recognize it -- John Brown. He was educated in no college, he graduated from no university -- he was simply a child of the people. He knew that is part in that struggle required the sacrifice of his life, and with a dozen men he attacked the so-called Commonwealth of Virginia. He struck the immortal blow. He was dragged through a mob trial, he was sentenced to death. On his way to the gallows he begged for a negro child and pressed a kiss upon its black face. He was strangled to death. His soul went its way to that bourne from which no traveler returns. John Brown was branded a traitor, a scoundrel, and a monster of iniquity. The whole country applauded the crime [of his execution]. In just 10 years, with the mellowing wings of time, John Brown was the hero of the people; enshrined in their hearts -- he had won immortality. Chattel slavery disappeared because in the development of machinery an improved form of slavery was required, and this new slavery must not be confined to the black race alone, but must embrace within its mighty folds all of the toiling children of men. Slavery in that form only became extinct and the people as such only rose against it when it became impossible; and just here it is in order to say that the development in every form is dependent upon economic conditions. We live today under a system that has the best code of morals and the best instruments of production and distribution. It has also the most destructive weapons of warfare. Commercialism not only requires the cheapest possible production, but it also requires the most murderous instruments of death, and in the full development of this system the world pays its highest tribute to that man who can devise ways and means that can murder the most men in the smallest space of time. If you go to the city of Washington tomorrow with some device that will enable you to kill one million human beings in the twinkling of an eye, your name will become famous. When the [Civil] war closed, modern machinery was developing very rapidly, the small workshop was beginning to disappear, being supplanted by the larger factory. The individual worked no longer by himself, for his tool had been touched by the magic of industrial evolution; the shop began to expand and the modern industrial revolution was on. Up to this time production was carried on largely for use in separate communities. There was no demand for a foreign market because there was no surplus production, and the worker's ability to consume was equal to his producing capacity. But with the advent of machinery, conditions were changed. If the workers had had intelligence enough to have retained the ownership and control of the tool -- that is to say, of the means of production, there would have been no such problems as now confront us. The women were formerly the queens of the homes, and the children were being sent to school and equipped for the battle of life. When labor began to supply so abundantly and the machine could be operated by the finger of a little child, we had an intensification of the struggle -- women competing with men and the child competing with all. No workingman is given employment that he may provide for himself and his family. It is only on condition that a profit can be extracted from his labor. If there is no profit he is discharged. His wife may suffer, his children may be on the street, no matter what the results, he cannot work. I have said again and again in this system there is nothing quite so cheap as human flesh and blood. It is in the power of a single individual sitting in New York to press a button that will send a message over the wire that will doom 50,000 willing men, women, and children. Concentration and cooperation are the master forces of this age. In the conflict that is going forward among the capitalists, the capital of the country is held in the hands of a few, and these few, though untitled and uncrowned, wield greater power than crowned kings and despots. The owners of the means of production are the real rulers of the American people and of all other people of other nations. Those who control the means of production, land, and capital, control all human institutions. Now, there are a great many men who believe that they have a voice in government. You workingmen have as much to do with the control of this government as if you inhabited Mars or some other planet. (Cheers.) You regularly deposit your ballot and suppose it to be counted. The will of the people is supposed to be registered. But what your votes register is the will of the capitalist class. The capitalist class rules absolutely in every department of our government. It controls every legislature. It controls both branches of Congress and the Supreme Court is simply its convenience. Why, it is not possible for a lawyer, whatever his attainments, to find his way to the bench of the Supreme Court unless he has given overwhelming evidence of his capacity to serve the capitalist class and his willingness to crook the pregnant hinges of the knee that thrift may follow fawning. Every judge who sits on the bench of the Supreme Court today is a tool of the capitalist class. I had an experience. (Great applause.) I think it was a good thing. I ought to have known better. The working class have no rights. I am not fond of denouncing the capitalist class. I am more inclined to find fault with the working class. Now, do you know that for every capitalist, large and small, in the United States there are about 10 workingmen? That is to say, you workingmen are in the majority, are in the clear majority of 10 to 1, and as long as you suffer the capitalist class to rule, you do not deserve to fare better. As Lincoln said: "If that is what you want, that is what you want," and as long as you are satisfied with the capitalist rule or misrule, you will have to submit to it. Now, a few workingmen realize that the old parties are simply two wings of the same capitalist vulture, and that every reform party is a straggling tail feather in that same bird. Socialism is after that bird, and if you look at it you can see the light between the wings. Some of that light is beginning to reach gradually the working class. They are beginning to realize, first, that their interests as workingmen are absolutely identical, that what is good for one is good for all, what it equal for one is equal for all. They are beginning to realize that there are trade unions in the year 1901 which fall short of requirements; that while organization is a necessity upon the economic field, it is vastly more important on the political field. There was a time when there was some efficiency in the strike. What difference does it make to you to go out on strike, even if you win a raise in your wages of 15, 20, or 25 cents per day, if the same class that employs and pays your wages has also the power to raise the cost of the commodities? In the wage system you and your children, and your children's children, if capitalism shall prevail until they are born, are condemned to slavery and there is no possible hope unless by throwing over the capitalist and voting for Socialism. Now, what you want to do is quit every capitalist party of every name whatsoever. What you want to do is to organize your class and assert your class interests as capitalists do the interests of the class that is robbing you. It will not do for you to go to the polls and vote for some good men on some of the tickets and expect relief in that way. What can a good man do if he should happen to get to Congress? What could he do? Why, he simply would be polluted or helpless, or both. What we want is not to reform the capitalist system. We want to get rid of it. (Tremendous cheers.) Now, it is a curious thing to me that a great many workingmen will vote for a thing that will do them no good, a thing that they do not want, because they are dead sure of getting it; and they will vote against the thing they need, against the thing they want, because they reason that if they all vote for it they might get it. Every workingman in every community should assert himself on election day, totally regardless of what others do. Suppose you are the only Socialist in the community. Now, that might require a little more courage on your part, and if you lack it we cannot win. But if you have a little more courage and if you cast a Socialist vote, you will give some evidence of the final redemption of your community. If you cast that vote, someday you and your children will be proud of it; you will make a beginning and you will soon have company. Now, I would rather vote my convictions and vote alone than to vote against my convictions and be with the majority. What good is it to be with the majority of cowards, anyway? As a matter of fact, in the history of great principles, men everywhere have been wrong outside the minority. All of these great changes depend upon minorities, and in the march of time a minority becomes a majority and everyone applauds. In 10 years from now it will be very difficult in the city of Chicago to find a man who was not a Socialist 25 years ago. There has never been any democracy in the world. Political democracy in the United States, so called, is a myth. A single capitalist, upon whom 25 workingmen depend, has political power more than equal to the slaves in his employ, simply because he owns and controls the means upon which their lives depend, without which they are doomed to idleness and starvation. What good would it do if it were in my power to shut off the supply of life and heat; you would all vote my ticket, would you not? Your lives depend upon the control and ownership of the means of production and distribution. The owner of the slaves had to provide for them, he had to feed them, and he had to care for them in a way. It is not necessary to own slaves bodily today in order to exploit their labor. You simply have to own the tool, then they are completely at your mercy. To begin with, a slave cannot buy the modern tool. They are gigantic machines of great cost. The great mass of workingmen cannot buy them. They are compelled to present themselves at the door of the giant and humbly petition him for the privilege of using the tools they made for a share of what their labor produces. They are at his mercy, and not only this, but in the regular periods of depression that always follow periods of activity, it is even a privilege to be a slave, and thousands of so-called free Americans are denied that privilege. (Cheers.) If they go on voting the Republican ticket and the Democratic ticket, either party perpetuates the system that keeps them in fetters and their wives in rags and their children in hunger. Arouse, ye slaves! Declare war, not on the capitalist, but on the capitalist system, and if it should be your fate or your fortune to suffer in years to come, that suffering will not be the result of your own deliberate act. I am for the freedom of the working class. Though my heart yearns for the freedom of men, I am powerless. Only the working class itself can achieve its emancipation. The workingman who is not yet awakened, who has not yet realized all his class interests, is a blind tool, the willing instrument of his own degradation, and thousands of them on the 4th of July, when reference is made to the capitalist flag that symbolizes the triumph of capitalism only, thousands of these wage slaves will applaud their own degradation. What is wanted is not a reform of the capitalist system, but its entire abolition. Notwithstanding the boast that is often made that this is an era of prosperity, notwithstanding the statement that is made by capitalist politicians that the wages of workingmen are higher than ever in the history of the history of the country, I do not hesitate to declare, and I challenge refutation, that there never was a time when wages were so small in proportion to the products as now. Politicians assure us that we are extremely prosperous because our exports exceed the exports of all other nations of the world. What have you got to do with the exports? I think if you held a little interview with your stomach, you are more interested with import than export. Much money goes into the pockets of the capitalist class out of the product of your labor. You never receive notice from the government to get your share of the dividends, and as a matter of fact, in this system the more you produce the worse you are off. If you could produce as much tomorrow as you could in the next six months, you would be out of a job the day after tomorrow. (Loud applause.) I wonder how many of the workingmen of Chicago are enjoying today at the sea coast this summer, or how many of them are toying with icicles in the arctic region, and next September how many will go down to Florida and stop at the Palmetto Hotel? Not many of them. Only the man can afford these luxuries, can afford these enjoyments, who has nothing to do with the production of them. No man that has anything to do with building a Pullman car can ride in it. You show me a man who has to make a Pullman car, and I will show you a man who walks when he travels. If you have calloused hands, I will show you precisely what degree you mark on the social thermometer. I will locate you close to the zero point. A man has to be a master or a slave. He will have to either wield a lash or hold the plow. Socialism proposes to free them both and level them both up to the plane of manhood. Whatever walk of life, constant struggle is going forward, man is arrayed against man, nation against nation, and all due to the capitalist system. The survival of the fittest is a survival of cunning over conscience. Business means doing somebody else, and in the struggle the middle class loses in economic power. Men are driven to dishonesty in the system; they suspect each other, not because they do not know each other, but because they do. It is a mock civilization. Socialism will give humanity a new world. (Great cheer.) Business men attend the same prayer meeting, but they keep a business eye on each other. Business is business, and each one knows that the other is trying to do him. In the capitalist system we cannot give expression to the noblest sentiments of humanity; all success is born of failure and he who achieves the largest success succeeds in destroying the largest number of his fellow men. The revolution is under way, but, like all revolutions, it is totally blind. It is in the nature of great social forces that they sometimes sweep humanity down. Let us work so that this revolution may come in peace. Socialists are organized to pave the way for its peaceful culmination. We appeal first to the working class to come together in one class-conscious solidarity. We likewise appeal to the middle class who will day by day be forced down in the crowded ranks of the working class. We are asking them to open their eyes and see the new light. Their class is doomed and this debauched civilization is doomed to disappear with them. If I were in the middle class today, I would be a Socialist. I would be a socialist from a perfectly selfish motive. I would say to myself: "My class is to be crowded out, and my only hope is in the new social order; and although I may not live to see it, I may be doomed to die a slave, I will cast my lot with the man that proposes to make it possible for my children and the children of my children to enjoy life." But there are a great many who say that is all well enough, but we will not see it in our time. When a man talks so to me, I am inclined to think that there is something seriously wrong with him. Very often the case is that it is impossible to reach the intellect of such a man as this. It is questionable whether he has a thing that we can properly call by that name. So far as I am concerned it does not matter in the slightest whether it comes next year or next century, or in a thousand centuries -- that is not a question that concerns me. I simply know that the change is bound to come sometime and I know that it is my duty to do all I can to hasten its coming; and although I feel and indeed, I know, that I will be here to help celebrate its coming, to ratify its triumph, whether I am or not is a matter of the slightest consequence. I simply say that the capitalist system has almost fulfilled its mission. On every hand we behold the signs of change. It is disintegrating. It is to dissolve and pass away and you can prolong it if you wish and that is what you are doing if you war supporting the old parties. There are two fundamental principles that are in conflict with each other -- individualism and cooperation. Now there is perfect individualism among the beasts of the jungle. They do not cooperate, they compete, and the stronger competitor devours the weaker. You see a girl in the sweatshop only able to earn enough to keep her wretched soul within her shrunken body. Her pulled cheeks, her sunken eyes, her emaciated body testify to the poverty and horror of the competitive system. Hail the coming of Socialism! But in every nation, in every civilized nation,men and women are massing beneath the banner of Socialism, men and women, for in Socialism woman stands side by side with man, she has all the rights that he enjoys. We declare then, that the time has come when working men should open their eyes to the economic struggle, when they should have an intelligent understanding of Socialism and pave the way for its triumph and the abolishment of capitalism from the face of the world. Now I have a right to get rich if I can in this system. I scorn to get rich. I could get rich only by making someone else poor. Suppose I have sharper claws and keener fangs than some of the rest of you, am I justified in using them to prey upon your vitals? If I have any ability whatever, I can only prove it by using it for the benefit of my fellow man. John Rockefeller is as completely a slave as any coal miner in the anthracite region of Pennsylvania. He lives in a gilded cell, but he is serving a life sentence. He does not mingle with his fellow men, he does not enjoy the fellowship of the class he robs. He rules by the power of private ownership and he tries to ease the pangs of conscience by endowing universities. We do not want educational institutions in that way and when Socialism supplants capitalism, and when the wealth that is created is in the possession of the men who created it, when every man has not only plenty of what is required to supply his physical wants, but has leisure to enjoy, we will fill this country with educational institutions, we will make education universal; not only that, we will rescue industry from its cupidity. Then man shall stand erect in touch with his fellow man. He will be the monarch of his work. It will not be possible for one man to enslave another without forging fetters for himself. There is no release, there is no relief on any other line. It is Socialism or capitalism; as capitalism declines, Socialism follows it, so it is only a question of time. I like the 4th of July. It breathes a spirit of revolution. On this day we reaffirm the ultimate triumph of Socialism. It is coming as certain as I stand in your presence. Trials are not to be regretted. T hey are a part and a necessary part of the development. We may disagree. We may divide. It is possible that we shall quarrel and still be perfectly honest. The development demands it all. We are all subscribers to the same fundamental principles. We all stand upon the same uncompromising platform. We all have our faces turned toward the economic dawn. We are battling for the triumph of the producers of the world. We are in touch with the International Socialists of the world -- with our ears turned down, we can hear the thrones totter before the great march of the international hosts of Socialism. So do not be discouraged for a single instant. If you have the courage of your convictions you can face the universe. So far as I am concerned, if there were a million, I would be one of the million. If they should be reduced to a thousand, I would be one of a thousand; if reduced to a hundred, I would be one of the hundred; if a single one survive, I would be that one against the world. I want every one of you to be that one and if you find that you are not so constituted that you can be that one against the world, you have no place in the Socialist movement, but go to the old parties and stay there until you get ripe. We are educating, we are agitating, we are organizing, that is to say we are preparing for the inevitable. It is only a question of time when Socialists will be in the majority. They will succeed on a platform declaring for the social ownership of the means of production and distribution. Then the factory will no longer be a dismal den thronged with industrial convicts. Then for a' that and a' that, man to man the world o'er, shall brothers be for a'that "

Moody's Seasoned Baa Corporate Bond Yield (BAA)

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they don't come any better then this

bubble nomics revisited


by sammo request

chartalism it used to be called
this guy is one of the so called new chartalists
or modern monetary theorists

consequently he hasn't a worry about peak debt
a sovereign state with debt payable entirely  in its own costlessly augmentable  un gold tied currency
can never go bankrupt if it don't want to
this means he hasn't idiotic long run burdens of short term gaping deficits to drag down his mind
as it does even the best non party line non neo liberal/neo classical poli econs ie the new post samuelson eclectics  like joe stiglitz
chumps that  still retain unexamined attachments to prudent fiscal finance for uncle

mostly out of inflation fear of course

but he hasn't much else on  his mind either on that front
he's a one trick pony
"The greatest lie—endlessly repeated by neoliberal economists and uncritically echoed by the mainstream media—is the claim that if governments cut their spending, the private sector will “crowd in” to fill the gap. British Prime Minister David Cameron’s austerity campaign and President Obama’s foreshadowed budget cuts are built around these lies."

true enough but ...
oh ya there's this line you've seen  else

"In the past, real wages grew in line with productivity, ensuring that firms could realize their expected profits via sales. With real wages lagging well behind productivity growth, a new way had to be found to keep workers consuming. The trick was found in the rise of “financial engineering,” which pushed ever increasing debt onto the household sector"

that begs the question why not use uncle's transfer system as is done now ??

behind this is a notion of greed pushing ever higher the rate of exploitation
as if that itself is a cyclical animal spirit
some how subdued by the great depression the world at war and the subsequent  pax americana
i think it had more to do with changes in the global structure of capitalism
but that's for another day

i'll add
in the ike ewra rads claimed the chronic shortage of investment against nominal "acc\umulation"
 was relieved by kold war military budgets
that were nice  employment builders and effective demand maintainers

but no more that cry not after say 1975

this  type of  magic bullet crusader  usually fails to notice open systems like national economies
are operating in a web of trading nations and even if their currency is still taken in exchange for products
their foreign exchange rate and their inevitable  trade gap  creates another set of macro problems
often called de industrialization

 solving domestic under employment by simply stimulating demand thru massive deficit financing
 can often make this problem far worse

in fact you notice he does have inflation and possibly exchange rates in the back of his head
as he  pops in that pinko favorite

"I would introduce an open-ended public employment program—a Job Guarantee—that offers a job at a living (minimum) wage to anyone who wants to work but cannot find employment. These jobs would “hire off the bottom,” in the sense that minimum wages are not in competition with the market-sector wage structure. By not competing with the private market, the Job Guarantee would avoid the inflationary tendencies of old-fashioned Keynesianism, which attempted to maintain full capacity utilization by “hiring off the top” (making purchases at market prices and competing for resources with all other demand elements). Job Guarantee workers would enjoy stable incomes, and their increased spending would boost confidence throughout the economy and underpin a private-spending recovery. There is no reason the government could not afford this program. The labor is available for work, and the government can easily supply the jobs. There were no questions asked when the government, in the early days of the crisis, instantly provided billions for the banks. Let me repeat: the government has no financial constraint on its spending and should immediately allocate funds to a massive job-creation program."

yup ...the uncle job gulag

despite not needing it according to pure MMT
err in a closed system mate
but open -ness
it comes from a back door limit on market driven employment created here not by import explosion
 but by high job demand by firms leading to a wage price spiral ala the infamous  70's
birth place of the mass adherence to the nairu line taboo
which is buried in this bit of fandango

the gulag is kool because

" minimum wages are not in competition with the market-sector wage structure"
oddly he fails to notice making that gulag wage a living wage would indeed lift all market earned wages right ??

" By not competing with the private market," dubious point
" the Job Guarantee would avoid the inflationary tendencies of old-fashioned Keynesianism"

here it comes
" which attempted to maintain full capacity utilization by “hiring off the top” (making purchases at market prices and competing for resources with all other demand elements)."
this  conflates demand pull inflation something impossible  with the type of capacity slack thst would trigger macro policy in the first place
with wage push inflation which happens because of corporate price cost pass thru power
he is buying into the nairu gig
without admiting it if he even clearly understands it
nairu woulsd keep the market the rate of unemployment just high enough to prevent an acceration of wage rates
now as a good rad matey
billy boy here wants to soak up  the reserve army so he offers them a iron floor wage rate job
that he flat out guarantees won't set of a wage explosion
cause he's drawing form the bottom not the top

instead of injecting enough  purchasing power into the system thru the transfer system ala 12 cylinder macro ala wild bill vickrey
letting tight markets pull wages where they may thhis plan has uncle's contrived  jobster gulag soak up the surplus labor pool
wpa a go go
and all i repeat without triggering a wage boom

how ??
its possible but only by  making sure the jobster gulag is no place any one wants to be
both wage rate wise and i suspect  conditions wise

obviously the diect necessity here
is to design and imlement a mechanism with the ability to regulate inflation set the price levl quarter by quarter
as a key and essential  part of the full  advanced solution that this guy tries to run from
enter the mark up market along with the trade balancing dollar exchange rate

neither semms to be arrows in his quiver

 solve  the fear of run away inflation and de industrialization
 that  lurk like ghouls  in the hearts of white hats like joe stgilitz and paul krugman
and is why they never get to bill vickrey land

mankiw and peak debt

the mankiw piece is an addiction story eh
simple message drink that booze like you drink it now
for another 15 years and you'll have a pink elephant moment
and a 5 year turkey trot over thin ice
but cut that crap out now
sure the joy of the happy hour high will leave its cavity in the soul of your job day
a certain purgatory trumps a perfect hell baby
pure preacher boy bull balls
paine said in reply to paine...
addicted primarily to ...living longer it would seem
and maybe a bit better too
err health wise
the theory behind starting now
not in 15 years ??

if you boil the frog slowly enough ...
paine said...
jump out of the mankiw pot now amerika !!!
rewrite the rule book
paine said...
we had one of these moments already
recall the moynihan greenspan payroll tax and benefit fix ??
that was so well slid in on us
it wasn't till twelve years or so ago
it begain to really bite
but you hardly feel what you miss all together
do we know today what that the trust fund build up
has cost us in additional burdens and forgone simple pleasures ??
well a couple trillion left in your pockets
you jobbled creeps
spread over 12 years or so
isn't the biggest alternative policy route
i can imagine
bringing the boys and girls in helmets home
and declaring peace with the world
exceeds that by a few times
--- as our anne faithfully points out
at every juncture --
but its still real money eh ??
there's more
there's the rampant
private health "CARE" sector !!!!!
go back to 65 and use the swedish or german trend cost rise
not ours
talk about yer boiled frog !!!!!
why betwqeen premiums and payroll taxes
the median gal in our job class has gone practically no where despite large gains in her per job hour value added
my my
no wonder the Dembos the party of the little people
has lost the faith of its base

mandarins and mandarins

spence seems to like
wallowing in his soft brand
of aging mandarin cruise control fatuity
in these days i guess that beats strident idiocy
like say
john roach taylor or bobby barro

how a leader of a cartel can control price

Sizeable Slack production

Size structure of firms

U.S. Firms and Establishments by Size, 2001
Size of Firm
Total Number of
Total Number of
Total Number of
Average Number of
Establishments per
Average Number of
Employees per
All firms
5,657,774 7,095,302 115,061,184 1.3 16.2
less than 20
5,036,845 5,093,660 20,602,635 1.0 4.0
less than 500
5,640,407 6,079,993 57,383,449 1.1 9.4
17,367 1,015,309 57,677,735 58.5 56.8
703,837 705,612 0 1.0 0.0
2,697,839 2,703,984 5,630,017 1.0 2.1
1,019,105 1,033,719 6,698,077 1.0 6.5
616,064 650,345 8,274,541 1.1 12.7
518,258 670,477 20,370,447 1.3 30.4
85,304 315,856 16,410,367 3.7 52.0
8,572 102,229 5,906,266 11.9 57.8
5,161 131,911 7,894,226 25.6 59.8
1,770 103,347 6,063,596 58.4 58.7
934 120,158 6,456,068 128.6 53.710,000+ 930 557,664 31,357,579 599.6 56.2