• Archive of "Economy" Category

    U.S. Awards $1.7 Billion Contract to Buy Radios for Afghan Army

    July 29, 2016 // 24 Comments »




    I always found myself giggling during the Democratic debates when Hillary would ask Bernie how he was going to pay for things like healthcare or college tuition, and then Bernie stammering to find an answer.


    They both knew the secret but neither would say it — there’s plenty of money, we just don’t want to spend it on Americans.

    We think of that as freeloading, unearned stuff. Go get a job, moocher. But then move the same question overseas and everything changes. There is always plenty of money, and the people getting free stuff from that money aren’t moochers. They’re allies.

    So how much healthcare would $1.7 billion buy? Because that’s how much money the United States just laid out to buy radios for the near-useless Afghan Army. And while I don’t know how much healthcare the money would buy, I do know it will purchase a helluva lot of radios. Is everyone in Afghanistan getting one? Maybe we’re buying them for the Taliban, too.


    Anyway, the $1,700,000,000 radios for Afghanistan contract was just recently awarded to the Harris Corporation. And here’s a funny thing: only one company — Harris — actually put in a bid for the contract.

    But the Afghans must need more stuff than just radios, and so the U.S. has money ready for that.

    The United States will provide $3 billion to the Afghan National Defense and Security Forces from 2018 to 2020 for, well, we don’t really know. Meanwhile, the U.S. Special Representative for Afghanistan and Pakistan said the White House planned to ask Congress for about $1 billion a year in development and economic assistance for Afghanistan through 2020. And if that isn’t enough, the United States and its allies are expected to raise $15 billion for the Afghan National Defense and Security forces at a NATO summit scheduled for next month in Warsaw.

    There’s money. You just can’t have any of it, moochers.



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    Another Way the Rich Get Richer: Their Parents Give Them Obscene Amounts of Money Nearly Tax-Free

    May 13, 2016 // 14 Comments »

    money


    It’d be great if we were all self-made men, like Citizen Trump.

    Of course, his self-making, like that of many wealthy people, is based in large part on a wealthy parent giving him a ton of money. Why work for a living when you can just hang around drinking single malt until daddy dies and leaves you his money?

    Trump’s papa left an estate valued at between $100 and $300 million in 1999. A nice start for a career in real estate for Don and his siblings.



    Getting All the Monies

    Now the idea that parents should be able to leave their money to their kids is all A-OK. That the hyper-wealthy can do it with little or no significant tax is not OK. It is one of the prime drivers of future economic inequality in the U.S. Absent a change in the law that will happen when pigs fly into a snowy hell, rich kids will only get richer, and then pass on their buckaroos to their heirs. They’ll have all the monies.

    In the words of one economist, even though the American dream is pulling yourself up by your bootstraps, we’ve made ample room in it for people whose boots are handed down.



    How Estate Taxes Work

    The first $5.43 million per heir is fully exempt from any tax. Spread the money around to siblings, spouses, kids and grandkids, and you can shield a bundle from tax easily. In fact, that system means 99.8 percent of all estates owe no estate tax at all. There is no reason the exemption has to be $5.43 million except to favor the wealthy, and there should be an overall cap on how much can be shielded from tax to prevent fake families from splitting things all up.

    For the small number of estates actually subject to some taxes, those taxes of course are due only on the portion of an estate’s value that exceeds the exemption level. So, a $6 million estate would owe estate taxes on only $570,000. Except that heirs can often shield a larger portion of the estate from taxation through deductions, loopholes and discounts written into the tax code. So, while the on-paper tax rate for estates is 40 percent, most pay about 16 percent in reality.



    It’s Complicated

    As an example of the complexity of estate planning-tax avoiding available to the rich, consider the grantor retained annuity trust. The estate owner puts money into a trust designed to repay the estate the initial amount plus interest at a rate set by the Treasury, typically over two years. If the investment — typically stock — rises in value any more than the Treasury rate, the gain goes to an heir tax-free. If the investment doesn’t rise in value, the full amount still goes back to the estate. Such techniques have been described as a “heads I win, tails we tie” bet.



    A Reasonable Idea

    If inheritances could be taxed reasonably, enough money would trickle down the legs of the rich that some societal benefits would accrue.

    Unfortunately, all three Republicans in the presidential race promise to abolish the estate tax altogether. Hillary and Bernie offer only weak promises of reform, focused on rolling the tax back to its (higher) 2009 levels. But they’ll need Congressional approval for that, so, no.

    It will be no surprise that American estate taxes are well below average among the countries in the Organization for Economic Co-Operation and Development.

    I know, I know, math and numbers are hard. So here it is in very simple words: by not fairly taxing the estates of the wealthy, we are locking in our staggering economic inequality for future generations.


    FUN FACT: The wealthiest ten percent of Americans takes home about half of all income. The richest 0.1 percent holds 22 percent of the country’s wealth.




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    U.S. Can’t Say Whether or Not $759 Million Spent on Education in Afghanistan Helped Anything

    May 10, 2016 // 14 Comments »

    Afghanistan Still

    If at where you work you spent $759 million on something, and then told your boss you have no idea if anything was accomplished, and that the little data you do have is probably fraudulent, how might that work out for you?

    If you are the U.S. government in Afghanistan, you would actually have no problem at all. Just another day at the tip of freedom’s spear, pouring taxpayer cash-a-roni down freedom’s money hole.

    The ever-weary Special Inspector General for Afghan Reconstruction (SIGAR), chronicling U.S. government hearts and minds spending in Afghanistan over the last 15 years, issued a new audit on Department of Defense, State Department and USAID’s $759 million “investment” in primary and secondary education in Afghanistan. Here’s what they found:

    — While USAID had a defined strategy for primary and secondary education in Afghanistan, DOD and State did not. They just spent money here and there without adult oversight.

    — DOD, State, and USAID have not adequately assessed their efforts to support education in Afghanistan. DOD did not assess the effectiveness of its education efforts, and State only evaluated self-selected individual programs. Same for USAID.

    — Without such comprehensive assessments, DOD, State, and USAID are unable to determine the impact that the $759 million they have spent has had in improving Afghan education. They agencies do, however, continue to spend more money anyway.

    — In 2014, USAID cited Afghan government data showing increased student enrollment from 900,000 students in 2002 to a whopping million in 2013 as evidence of overall progress in the sector. Unfortunately, USAID cannot verify whether or not the Afghan data is reliable. In fact, both the Afghan Ministry of Education itself and independent assessments have raised significant concern that the education data is not true.



    Interest from the American public remains at exactly zero, because we don’t need no education about where our government spends our money.

    BONUS: Anyone’s town out there in America that would not benefit from a handful of cash out of that $759 million spent on Afghan schools? Flint? Newark? Philly? Bueller? Anyone?




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    Capitalism Without the Das Capital: Welcome to Uber’s Gig Economy

    April 28, 2016 // 8 Comments »

    uber

    One of the defining aspects of traditional capitalism is that the Capitalist, that one percent guy from the Monopoly game with the top hat, spats and monocle, invests capital. That investment, in land, a factory, an oil well, creates value (the monies) for him, and jobs for the rest of us.



    Capitalism 101

    The idea is that because the Capitalist risks his money/capital, he is assuming the greater risk and thus deserves the greater gain. This has been the way things have worked since feudal lords controlled land and allowed sharecroppers to keep pennies on the dollar they earned for him, on through to when people built factories and opened stores.

    Traditional capitalism is that stuff you slept through in Econ 101. Risk gain, employment, jobs, whatevers unless you live off an allowance from Daddy.

    Until the arrival of the gig economy.



    The Gig Economy

    For those who are living off an allowance from Daddy, or are one of the eleven Americans who still hold a traditional “job” where you do stuff, get paid a regular salary not tied to how many sneakers you sew each day, and receive those “benefits” you once heard grandpa speak of, the gig economy is where you work piecemeal, get paid a few table scraps and have no benefits or job security because you really don’t work for anyone.

    These “gigs” are almost always performing low-level services, such as delivering food to or driving around people much wealthier than you. Those people cannot be bothered to walk to a restaurant or pilot a motor vehicle or clean up their kids’/doggies’ poo, so you do it because you don’t have many other options in hope of earning something more than minimum wage.

    The gig economy is sometimes also known as the 1099 economy, after the IRS form used to report non-employee earnings, or the on-demand economy based on the way people get or don’t get opportunities to work. No one knows how big this shadow economy is, given the shifting nature of the work and the cash payments sometimes involved. But it is big and it is growing.

    The less-discussed game changer of the gig economy is that traditional capitalists no longer need to put much money at risk at all. In fact the companies behind the gig economy, the people who run Uber and the others, are economically viable because they offload their cost of capital — the investment and depreciation on cars and the cost of keeping a driver fed and healthy — onto the drivers, who are only willing to accept such a bad deal because the labor market sucks. See how that works?

    And if that’s not problem enough, the cheaper wages paid (for example, by Uber) to drivers, and thus the cheaper rides, also drive business with capital structures which make social sense out of business. They can’t compete with “drive your car into the ground, make whatever you might get along the way while we cash in.”

    And when you talk about driving these days, you’re talking about Uber.



    Uber Costs

    Uber has succeeded in almost completely pushing its operating costs (absent the relatively small investment needed to run the app and backoffice) down to people who often can’t afford it but are lured into trying because the alternatives seem even lower paying.

    To drive for Uber, you need a late model car, in great shape, with four doors. It doesn’t have to be a black sedan, but if it isn’t Uber will exclude you from a number of ride requests.

    So where does someone without a lot of money get a late model black sedan? If they can afford it, they buy one, but that means laying out a lot of money and taking on some heavy credit up front. More than likely, however, what a budding Uber driver does is lease his black sedan from an Uber-suggested third party contractor. You’ll find them right on the Uber website. They’ll take an average $500 deposit to sign you into a three year lease running $300 a month. So that all adds up to a capital investment by the driver of $11,300 over three years.

    Next capital cost to the driver is insurance, expensive insurance, because the cheap minimum stuff you buy off the TV ads is not going to cover you driving passengers around. Don’t worry, though, as Uber will sell you just what you need, albeit at $4,600 a year. That works out to $13,800 for three years.

    And, hey, driver, you need to pay for licensing, gas, maintenance, fines, regular car washes, depreciation of your vehicle and all the other stuff. Over three years, let’s call it $5,000.

    So overall, the cost for you to get a job with Uber is about $30,100 over three years. If you don’t have the cash on hand, and need to borrow it, add on 13% interest or more if using a credit card, maybe more for second-level sources for people who don’t qualify for good credit.

    But wait — many jurisdictions are now demanding additional licenses from Uber drivers, claiming they are operating a business. One of the more extreme plans under consideration is in Newark, New Jersey. The city is looking at a $500 annual fee to operate in the city, $1,000 additional license to pick up and drop off passengers at the airport and Newark Penn Station, and a $1.5 million insurance coverage requirement.

    If the driver fails to make any of those payments, s/he instantly becomes unemployed, unable to pay enough to have a job to earn enough to pay for that job. This is, in economic terms, an extractive process — a third party takes profit, leaves the true costs of capital to the workers, and when they fail, to society who will need to step in and provide food benefits as a last resort.



    Uber Risks

    In addition to having to raise their own capital to essentially buy themselves a job driving for Uber, drivers face risks far above the simple “risk” associated with any “investment.”

    In addition to the obvious risks of accidents, bad reviews, and good/bad weather that cuts the number of people seeking rides, perhaps the biggest financial risk to any driver is Uber itself.

    Imagine a situation where there are 10 riders in a city, and ten Uber drivers. For argument’s sake, let’s say each driver gets one fare a night. Uber makes money on its 27% share of 10 rides. Now, increase the number of Uber drivers to 100 (which makes getting a ride easier and faster for quicker profit for Uber and protects Uber when drivers quit) while the number of rides stays at 10. That means 90 drivers make nothing each night. Independent of the number of drivers, Uber still makes the same money on its share of 10 rides.

    In 2015, Uber doubled the number of drivers in the U.S. As of October 2015, the company had 327,000 active drivers, more than doubling the 160,000 that gave rides in 2014. Some of the new drivers are absorbed by growth in ridership, some are not.

    The other risk is that Uber sets prices, which vary even though the driver’s costs do not. For example, in order to theoretically boast ridership, Uber lowered prices in New York City such that individual drivers saw an average decline in payouts of 15%. The company also experimented with rate cuts in 99 other North American cities.



    Uber Pool

    UberPool is a new service where multiple customers headed the same way can “share” a car.

    Imagine two Uber drivers each carrying a single passenger along the same route which results in a fare of $11. After Uber takes its brokerage cut as well as its “safety fee” (even though the company still has the poorest driver background checks in the taxi industry), each driver ends up with $8 each in pocket, while Uber ends up with $6, a 27% commission for Uber.

    Now along comes UberPool, and these same two serial riders get picked up by a single driver. Since UberPool offers passengers a substantial discount for sharing a ride, that means each passenger now pays $6 (in this example). After Uber takes its commission, including the safety fee, the payout to the driver is $4 for each passenger, or a total of $8. So the driver makes the same amount, but Uber’s take of the overall $12 for this ride is also $4 – a 33% overall commission. So Uber makes a higher percent on UberPool rides, yet the driver makes about the same amount.

    Money

    The other side of financial risk is financial return, what you get after investing capital. For Uber drivers, there is no realistic average. Take a look at one of the many online driver forums and you’ll see a range of claimed payouts so wide (from sub-minimum wage to thousands a week) that it is of no real value. Here is at least one reasonable breakdown of costs and payouts.

    Leaving aside the forum posters who are just lying for whatever reason, the variables of driving for Uber are such that averages are not really possible. One of the few variables under the driver’s control is number of hours worked, and many of those who claim high weekly payouts also claim to drive 12 or more hours a day. Leaving aside the not inconsequential question of whether you feel it’s safe to catch those guys 11.5 hours into their shift, it leaves the economic question of how many hours a week it takes in the gig economy to earn a decent living.

    The New World Order

    Unlike conventional labor, where one starts at zero on day one and begins earning money, or traditional self-employment where in return for capital investment one keeps 100% of the profits, the gig economy’s main point is that people working for places like Uber start behind, maybe $10,000 in the hole after they secure a car, insurance and all the rest. Uber, however, begins profiting from the driver’s labor immediately, and loses nothing when the driver is pushed aside.

    All of the gain, none of the risk, in the New Economy where people pay for their own jobs.

    What other business is there where the Capitalist takes almost no risk, invests no capital, and pushes all that down on his workers alone, while raking in money? Oh, rights, pimps. Welcome to the gig economy.




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    City Council Passes Law Limiting Homeless People’s Belongings to What Can Fit in Trash Bin

    April 14, 2016 // 5 Comments »

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    Like every American city in the Age of the 99 Percent, Los Angeles has a significant homeless problem.


    Full-on shantytowns are now a feature of LA’s urban landscape, with colonies of desperate men and women setting up camps, and building shelters out of tarps, wherever they can find safe space to do so. The city’s homeless population rose 20% over the last two years, now estimated at 26,000 human beings, fellow Americans.

    What to do about such a problem? Build affordable housing? Increase shelter outreach? Provide mental health and substance abuse counseling? Job training? Compassion for those less fortunate?

    No.

    The Los Angeles City Council approved a law Wednesday that limits the possessions of homeless people to what can fit in a 60-gallon trash bin. The measure spoke to the will of the people, passing on a 13-1 vote, with some hippie councilman opposing. Another city councilman, who voted for the law, said the measure “balanced the city’s need for safe and clean streets with homeless people’s personal property rights.”

    As long as those personal property rights are limited to what the LAPD, acting on behalf of the well-to-do, can easily throw away.


    But some good news: the council backed off even stricter rules that would have limited homeless people to what they could carry in a backpack. But the law allows the city to clamp down in this way in the future without further public discussion.

    Under the new measure, the city can impound homeless people’s “excess personal property” after providing 24 hours’ notice. The city will store the items for 90 days, during which time the owners can claim them. But they cannot evade further confiscation by moving the items to another public area, the ordinance says.

    With no advance warning, the city can seize and impound a tent that has not been taken down during the day. Bulky and contaminated items can be seized and discarded without warning. Wheelchairs, crutches and walkers are currently exempt.

    “We recognize this is just one step forward to address the homelessness crisis,” said the president of the Central City Association of Los Angeles.

    Why, next thing you know the LAPD will just start putting rounds downrange and deal with the homeless in what will no doubt be called the final solution, of freedom.


    (FYI: The photo above is my own, taken in New York City’s Washington Square Park; the one below, of Tom Morello of Rage Against the Machine, was taken by someone else)






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    Poor People Should Just Go Die

    April 9, 2016 // 17 Comments »

    Poorich

    Despite advances in medicine, technology and education, the longevity gap between high-income and low-income Americans has widened sharply. You want to talk inequality? Talk about this.


    The poor are losing ground not only in income, but also in years of life, the most basic measure of well-being. In the early 1970s, a 60-year-old man in the top half of the earnings ladder could expect to live 1.2 years longer than a man of the same age in the bottom half, according to an analysis by the Social Security Administration. By 2001, and he could expect to live 5.8 years longer than his poorer counterpart.

    New research offers even more horrifying numbers. Economists found for men born in 1920, there was a six-year difference in life expectancy between the top 10 percent of earners and the bottom 10 percent. For men born in 1950, that difference had more than doubled, to 14 years.

    The serfs are dying. The castle-owners are buying themselves more years.

    Poor health outcomes for low-income Americans have dragged the United States down to some of the lowest rankings of life expectancy among industrialized nations. The Social Security Administration found, for example, that life expectancy for the wealthiest American men at age 60 was just below the rates in Iceland and Japan, two countries where people live the longest. However, for Americans in the bottom quarter of the wage scale, their life expectancy is closer to that in Poland and the Czech Republic.

    The gap in life spans started widening about 40 years ago, when income inequality began to grow.

    Earlier in the 20th century, trends in life spans were of declining disparities, because improvements in public health, such as the invention of the polio vaccine and improved sanitation, benefited rich and poor alike. The broad adoption of medication for high blood pressure in the 1950s led to a major improvement for black men, erasing a big part of the gap with whites. But medical improvements can also drive disparity when they disproportionately benefit affluent Americans; for example, cutting-edge cancer treatments.


    Imagine that — in one of the world’s richest countries, people die simply because we can’t find a way to provide them good healthcare as does the rest of the civilized world.


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    ‘Please do not feed the animals’: Oklahoma GOP Compares Food Stamp Recipients to Park Animals

    April 8, 2016 // 7 Comments »

    Bear_approaching_vehicle_in_Yellowstone_National_Park_1967

    In America, we have a very crude understanding of social welfare programs. For most Americans, anything the government gives to its people (i.e., us) to keep us healthy, fed and educated, is a “handout” to lazy people who don’t deserve it.

    Helping each other, using our tax money for us, as does most of the civilized world, is somehow wrong. In America, we’d prefer you starve to death, quietly if possible, as the rest of us are binge watching Netflix whilst eating Doritos.

    Doritos we worked for, dammit. Albeit at our minimum wage jobs at Walmart, but whatever.

    And with that, welcome to that rotting greenish boil head otherwise known as Oklahoma, where the Republican Party compared Americans receiving food stamp benefits to park animals fed by the public.

    In the since-deleted Facebook post, the Oklahoma GOP offered a “lesson” by comparing the distribution of food stamps to 46 million Americans to a policy of the National Park Service to discourage the public from feeding animals “because the animals will grow dependent on handouts and will not learn to take care of themselves.”

    Party Chairman Randy Brogdon offered a faux-apology in another Facebook post: “I offer my apologies for those who were offended – that was not my intention.”

    Which is hilarious and clear proof he was dropped on his head as a child by his alcoholic mother, because of course it is obvious that comparing needy people to animals is offensive to absolutely everyone. Even a park animal could see that.

    This also isn’t the first time the GOP has compared Americans to animals. In 2014, South Dakota Senate candidate Dr. Annette Bosworth’s posted a nearly identical post to her Facebook campaign page:





    FUN FACT: A very large percentage of food stamp recipients are children (“cubs”), the elderly, and disabled people. Maybe it’s time to thin the herd.



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    Job Totals Trail Pre-Recession Levels in 10 U.S. States

    April 7, 2016 // 5 Comments »

    depression-photo-jobless-library-of-congress


    Every candidate shouts about job creation, and some talk about the recovery from the last recession. Every month the Department of Labor releases new statistics about how many jobs have been created, improvements in the unemployment rate, and on and on.


    There are parts of the society and the country where some of that is even partly true. But for about 20% of our states, it is not even partly close. An awful lot of the good news is just a numbers game.

    Data compiled by the Associated Press shows ten U.S. states still have not regained all the jobs they lost in the Great Recession, even after six and a half years of “recovery,” while many more have seen only modest gains.

    The figures are one more sign of the economic inequality, the one field America remains the undisputed global leader. The on-the-ground reality of negative job growth is why many Americans feel the economy has passed them by, and fuels support for angry candidates Donald Trump and Bernie Sanders.



    Who Lost

    Wyoming has three percent fewer jobs it did when the recession began. Alabama’s job total post-recession is -2.7 percent, followed by New Mexico at -2.6. New Jersey (Chris Christie!) has one percent fewer jobs than it did at the end of 2007, and Missouri is just below its pre-recession level. The other five losers are Mississippi, Nevada, Maine, Connecticut, and West Virginia.

    Among the other states, several show only small gains past pre-recession job totals. Illinois, statewide with a population of over 12 million, has only 8,600 more jobs than it did in December 2007. Arizona’s job count is up just 9,200 with a population of six million (not counting illegal aliens.) And Ohio (Kasich!!!) has added just 58,100 jobs with its population of almost 12 million. Those gains are more or less (it’s less) statistically insignificant.

    Who Won

    The states that saw the highest rates of job growth tell the story of the last few years. Some of the biggest gainers include:

    Washington DC is a big, big winner, with significant growth from America’s largest employer, the federal government, all fueled significantly by the very profitable War of Terror.

    The oil and gas drilling boom lifted North Dakota’s job count by more than 20 percent, though falling energy prices have caused significant layoffs in the past year. Need to check back with North Dakota in a year or two.

    Texas has also benefited from the energy boom, as well as greater high-tech hiring in cities like Austin.

    Utah and Colorado have also benefited from fast-growing information technology companies. Colorado especially has a large aerospace (read: defense) industry, so good for them.




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    Are Trade Deals Like NAFTA and TPP Good, or Bad, for America?

    April 5, 2016 // 3 Comments »

    Detailed_Triangle_Trade

    Are international trade deals, such as NAFTA and the TPP, good for America, or bad for America?

    The answer is yes, depending on who you ask.

    What Are NAFTA and TPP?

    The North American Free Trade Agreement (NAFTA), which went into force in 1994, and the Trans-Pacific Partnership (TPP), which is still pending ratification in the U.S. and elsewhere, are examples of the type of broad-based, large-scale international trade agreements now discussed by American presidential candidates with the same tone of voice used to speak of that wet soup in street gutters. Indeed, even discussing the subject of whether they are good or bad for America may be little more than an academic argument at this point; Trump has sworn to make no new trade agreements and says he will not support the TPP. Hillary is a little cagier in her response, but, for the record, for now, says she too will not support TPP.

    But let’s slow things down a bit, and look into that key question, of how things like NAFTA and the TPP might affect Americans. After all, candidates do occasionally say one thing during the campaign, and another when actually in office, right?



    The Basics

    International trade deals are agreements between countries, often groups of countries, that are designed to promote more trade, more goods and services, and sometimes more workers, moving across borders. The deals typically reduce taxes and tariffs, change visa rules, and sometimes soften regulations that keep foreign products out. The phrase used most often is “lower the barriers.”

    So, if widgets made expensively in the U.S. can be made more cheaply in Vietnam and then imported into the U.S., something like TPP can facilitate that by lowering American tariffs on widgets. Meanwhile, Vietnam might be required to change its agricultural import system to allow American genetically modified fruit to flow into Hanoi’s supermarkets.



    NAFTA

    NAFTA is a good place to start in learning more, as it involves three countries — the U.S., Canada, and Mexico — that generally get along, play reasonably fair, and already had a robust cross-border trade. Lots of non-variables there. Plus, since NAFTA’s been around for over 20 years, there should be a decent consensus on how it worked. That will provide a real world example to weigh against a newcomer like the TPP.

    You wish.

    There are numbers. For example, the U.S. Chamber of Commerce says increased trade from NAFTA supports about five million U.S. jobs. Unemployment was 7.1% in the decade before NAFTA, and 5.1% from 1994 to 2007. But then again unemployment from 2008 to 2012 has been significantly higher.

    You can find similar ups and downs on imports and exports, value of goods, and the like. Some are clearer than others; since 1993, U.S. exports to Canada and Mexico have climbed 201 percent and 370 percent. The problem is trying to attribute them. Global economics is a complex business, and pointing to a singularity of cause and effect is tough.

    Want to see for yourself? Here, and here, and here, and here are articles from smart people who can’t figure out if NAFTA has been a good thing or a bad thing. It is not that simple. And NAFTA, remember, was just three countries. The TPP would draw in 12 nations.

    Cui Bono?

    The Latin phrase cui bono means “who benefits?,” and is used by detectives to imply that whoever appears to have the most to gain from a crime is probably the culprit. More generally, it’s used in English to question the advantage of carrying something out. In the case of things like NAFTA and TPP, the criminal context might be more applicable.

    Most everyone can agree that NAFTA made certain products cheaper for American consumers, as manufacturing costs are lower in Mexico than Idaho. American companies who found new export markets abroad also saw a rising tide of new money. The problem is that for many Americans, in the words of historian Morris Berman, that rising tide lifted all yachts, and not all boats.

    Allowing American firms to make things abroad and import them into the U.S. free or at low tariff cost moves manufacturing jobs out of the United States. No argument there among economists. The current celebrity case, cited by several candidates, is that of Carrier. Carrier just sent 1,400 jobs making furnaces and heating equipment to Mexico. Workers there typically earn about $19 a day, less than what many on Carrier’s Indiana assembly line used to make in an hour.

    Carrier will see higher profits due to lower costs. They may or may not pass on some portion of those savings to American consumers. They have put Americans out of work.

    The Losers

    Economists will often claim that such job losses are part of the invisible hand, how capitalism works, duh. The laid off workers need to learn to code and build web pages, migrate to employment hot spots such as California like modern day Tom Joads. But pay a visit to nearly anywhere in what we now blithely call America’s Rust Belt, and see how that’s working out.

    Retraining industrial workers just does not happen overnight, even if there was free, quality education (there’s not.) Indeed, since the beginnings of the hollowing out of America, it has not happened at all. The risk is also that retraining takes unemployed, unskilled people and turns them into unemployed, skilled people. Training is only of value when it is connected to a job. Remember, as all those unemployed Carrier people somehow learn to build web pages, America’s colleges are churning out new workers, digital natives, who already have the skills. Even Silicon Valley’s needs are finite.

    Patterns do emerge, and the American people know they’ve been had at the expense of corporations that do indeed benefit from international trade agreements. Many Americans see that average workers and thousands of communities have been screwed by trade agreements which put them in direct competition with low wage workers around the world.

    Everybody Wins, Except for Most of Us

    Economist Robert Scott says he knows. He claims over the last 20 years, trade and investment deals have increased U.S. trade deficits and cost Americans their jobs. For example, the agreement allowing China into the World Trade Organization led to trade deficits that eliminated 3.2 million jobs between 2001 and 2013. Meanwhile, the United States already faces a trade deficit with countries in the proposed Trans-Pacific Partnership that cost two million U.S. jobs in 2015.

    In his 2008 book, Everybody Wins, Except for Most of Us, Josh Bivens shows that while the most privileged Americans have benefited from cost-savings due to trade, increased global integration harms working Americans. Bivens estimated that the growth of trade with low-wage countries reduced the median wage for full-time workers without a college degree by about $1,800 per year in 2011.



    A Broader View

    Of course there are dissenting opinions; another economist cautions “to understand how dismantling trade barriers helps the country, we also need to take a broader view of the American economy, and not focus solely on disruptions and lost jobs in particular sectors.”

    And that makes sense, if you believe economics is about money.

    But if one is asking whether or not international trade agreements are good, or bad, for America, one needs to think bigger. On a whole-of-society level, economics is about people. We all want American companies to make money. It’s also great that Walmart is full of low-cost consumer electronics from Asia, or Carrier air conditioners fresh from Mexico, but you need money — a job — to buy them.

    Think broader, and you’ll see economics is about people. Let that answer the question for you about whether international trade agreements are good or bad for your part of America.




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    Iraq is Broke. You Have to Pay for It.

    April 2, 2016 // 14 Comments »

    sheikeagle


    The next time a candidate or reporter asks during a debate about education or healthcare “But how are you going to pay for that?” I would like the person being questioned to respond “The same way we find money to pay for Iraq.”


    So maybe it would just be better for Flint, Michigan to claim it is under attack by ISIS instead of just being poisoned because no one has the money to fix America’s infrastructure.

    See, each month, Iraq’s government pays out nearly $4 billion in salaries and pensions to the military and a bloated array of corrupt public-sector workers. But with more than 90 percent of government revenue coming from oil, it is bringing in only about half that as crude prices plunge. Some Iraqi officials and analysts say the government might struggle later this year to pay the seven million people on the public payroll, which could trigger mass unrest.

    As a sign of the times, Iraqis are facing more nominal charges every day. Hospitals, which have long treated Iraqis free of charge, have introduced fees, for example, even for those visiting sick relatives.

    For Iraq, the decline comes in the midst of an already destabilizing war. There are bills for reconstructing flattened cities destroyed for freedom, and assistance for the 3.3 million Iraqis who have been internally displaced over the past two years, with more expected to come.


    So — good news, at least for Iraq — the United States is stepping in with U.S. taxpayer money to make sure the country can continue military spending while it seeks international loans.

    So, while there is apparently no way anyone can conceive of to pay for fixing America’s infrastructure, making higher education affordable, reducing healthcare costs or any of those other icky socialist thingies, there is money for Iraq!



    BONUS: No one really knows how much money the U.S. has already spent in Iraq, but it is way over two trillion dollars.

    BONUS BONUS: The golden eagle shown above was paid for by the American taxpayers in 2010 as part of the reconstruction of Iraq. The area where it is shown is now devastated by the current fighting. I took the photo myself.





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    Calling Bull on Fast Food CEO Who Says Higher Min Wage Forcing Him to Automation

    March 22, 2016 // 7 Comments »

    andy


    The CEO of Carl’s Jr. and Hardee’s visited a fully automated restaurant, and it’s given him some evil ideas on how to deal with rising minimum wages.

    CEO Andy Puzder (above) said “We could have a restaurant… where you order on a kiosk, you pay with a credit or debit card, your order pops up, and you never see a person.”

    Puzder’s interest in an employee-free restaurant has been sparked by rising minimum wages. “With government driving up the cost of labor, it’s driving down the number of jobs,” he says. “You’re going to see automation not just in airports and grocery stores, but in restaurants.”

    The CEO has been an outspoken advocate against raising the minimum wage, writing op-eds on how a higher minimum wage would lead to reduced employment opportunities. “This is the problem with Bernie Sanders, and Hillary Clinton, and progressives who push very hard to raise the minimum wage,” says Puzder. “Does it really help if Sally makes $3 more an hour if Suzie has no job?”


    So let’s unpack Puzder’s remarks, and call bullsh*t on him.

    The federal minimum wage hit its high point in 1968 at $8.54 in today’s dollars and while this country has been a paradise in the ensuing decades for what we now call the “One Percent,” it’s been downhill for low-wage workers ever since. In fact, since it was last raised in 2009 at the federal level to $7.25 per hour, the minimum has lost about 8.1% of its purchasing power to inflation. In other words, minimum-wage workers actually make less now than they did in 1968.

    So if Puzder cannot make money by paying circa-1968 wages with 2016 prices in force, he needs some business lessons.


    But are wages really what this is all about? Let’s see what else Puzder had to say.

    “They’re always polite, they always upsell, they never take a vacation, they never show up late, there’s never a slip-and-fall, or an age, sex, or race discrimination case,” says Puzder of swapping employees for machines.

    Ah, yes, there we have it.

    Puzder doesn’t want cheaper labor per se, he wants to quit trying to figure out how to make his people work like machines, and just have machines work like he wishes people would do. Stupid people, with their need for time off and desire not to be discriminated against.



    BONUS: Guess what? One of the nation’s highest minimum wages, in Seattle, has not led to mass unemployment at all.

    DOUBLE BONUS: In addition, while we all grieve for poor CEOs forced to pay out a living wage, think bigger. Higher wages mean fewer people needing food assistance, which means lower taxes. Higher wages also puts more money into the economy, usually the very local economy. Unlike wealthy people like CEOs, who tend to save their money or invest it, lower income people spend their wages. An extra dollar to a Carl’s, Jr. worker moves quickly into the hands of a local food store, which uses the dollar to purchase goods, which boosts the whole blessed mess.

    SUPER SIZE BONUS: Bloomberg reported Puzder’s salary and other compensation as $4.485 million, so he is doing well. His restaurant chain is doing well, too, as profits rose more than 30 percent last year.

    DESSERT: Puzder also lobbied against a Department of Labor rule change that currently allows him to deny his restaurant assistant managers overtime by claiming they are executives.

    A SECOND DESSERT:  Puzder argues that social welfare “programs have the unintended consequence of discouraging work rather than encouraging independence, self-reliance, and pride, and that, because of government assistance, low-wage employees across the United States are refusing promotions and additional hours for fear of losing public assistance.”


    So I’ll have fries with that bullsh*t please!



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    Restaurants Demand State Freeze Servers’ Wage

    February 25, 2016 // 12 Comments »

    waitress___watercolors_by_massamitsu-d5g3p06


    More Americans work for less than minimum wage than work for minimum wage. They are the people who occupy tipped positions, mostly working as servers in restaurants.


    They fall outside the minimum wage, and thus do not have even the weak assurances of an income the minimum provides. And those tips — they are great at some swanky joints, weak at lesser ones. Tips ebb and flow, depending on the weather (rain and snow can keep customers home), cheapo patrons and which shift one pulls; daytime Tuesday is not as good as Saturday night. Or a four top who orders wine with each course, or that family on vacation who “just wants ice water.” Your income depends as much on luck as anything you do with your time and labor.

    Or here’s one strategy that does not depend on luck: encourage your waitresses to dress sexy, such as at Hooter’s, to pull in more tips, mixing sexual exploitation with exploitation of wages.

    And save the speech about how all these folks should go out and get a different job if they don’t like the system. Almost two million Americans work below minimum, and they do not have access to two million currently available, better paying, jobs.

    But from the restaurant owner’s side, the deal is sweeeeeeeeeet. They get to pay subminimum wage, and leave it up to the customers to make up their payroll. And if the customer stiffs the waiter, that’s no skin off the owner’s nose. And of course some owner’s skim the tips, and/or require servers to share their tips with the back of the house kitchen staff, diluting a small amount of money further.



    The owners have no interest in having the government mess with that solid gold system if it can be helped.

    As an example, New York state’s hourly minimum wage for tipped workers rose from $5.00 to $7.50 on January 1 (standard, non-tipped, minimum wage is $9.00 an hour in the state), much to the dismay of the New York State Restaurant Association. The restaurant owners lobbying group sent a letter to NY Governor Andrew Cuomo demanding that he freeze the tipped wage for five years. This letter comes just weeks after the National Restaurant Association filed an appeal with the state Supreme Court, claiming that Cuomo’s plan to raise the minimum wage further by 2018 is part of a longstanding pattern of discrimination “against the hard working men and women that own New York’s restaurants.”

    Implied is a hearty “up yours to the working men and women that work in New York’s restaurants.”


    Oh, and by the way, want to know if your favorite restaurant owner supports the freeze? You can’t. The Restaurant Association’s letter had more then 100 restaurant owners included as signatories. However, the Association will not release the names of the signatories because restaurateurs who have taken “political stances” in the past “have received death threats.” So it’s a safety issue. Right.

    Employers should be responsible for paying their own employees, not relying on customers to hand over cash just to keep serfs servers on the job.



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    You Can’t Earn a Living on the Minimum Wage

    February 20, 2016 // 17 Comments »

    child


    When presidential candidate Bernie Sanders talks about income inequality, and when other candidates speak about the minimum wage and food stamps, what are they really talking about?

    Whether they know it or not, it’s something like this.


    My Working Life Then

    A few years ago, I wrote about my experience enmeshed in the minimum-wage economy, chronicling the collapse of good people who could not earn enough money, often working 60-plus hours a week at multiple jobs, to feed their families. I saw that, in this country, people trying to make ends meet in such a fashion still had to resort to food benefit programs and charity. I saw an employee fired for stealing lunches from the break room refrigerator to feed himself. I watched as a co-worker secretly brought her two kids into the store and left them to wander alone for hours because she couldn’t afford childcare. (As it happens, 29% of low-wage employees are single parents.)

    At that point, having worked at the State Department for 24 years, I had been booted out for being a whistleblower. I wasn’t sure what would happen to me next and so took a series of minimum wage jobs. Finding myself plunged into the low-wage economy was a sobering, even frightening, experience that made me realize just how ignorant I had been about the lives of the people who rang me up at stores or served me food in restaurants. Though millions of adults work for minimum wage, until I did it myself I knew nothing about what that involved, which meant I knew next to nothing about twenty-first-century America.

    I was lucky. I didn’t become one of those millions of people trapped as the “working poor.” I made it out. But with all the election talk about the economy, I decided it was time to go back and take another look at where I had been, and where too many others still are.


    My Working Life Now

    I found things were pretty much the same in 2016 as they were in 2012, which meant — because there was no real improvement — that things were actually worse.

    This time around, I worked for a month and a half at a national retail chain in New York City. While mine was hardly a scientific experiment, I’d be willing to bet an hour of my minimum-wage salary ($9 before taxes) that what follows is pretty typical of the New Economy.

    Just getting hired wasn’t easy for this 56-year-old guy. To become a sales clerk, peddling items that were generally well under $50 a pop, I needed two previous employment references and I had to pass a credit check. Unlike some low-wage jobs, a mandatory drug test wasn’t part of the process, but there was a criminal background check and I was told drug offenses would disqualify me. I was given an exam twice, by two different managers, designed to see how I’d respond to various customer situations. In other words, anyone without some education, good English, a decent work history, and a clean record wouldn’t even qualify for minimum-wage money at this chain.

    And believe me, I earned that money. Any shift under six hours involved only a 15-minute break (which cost the company just $2.25). Trust me, at my age, after hours standing, I needed that break and I wasn’t even the oldest or least fit employee. After six hours, you did get a 45-minute break, but were only paid for 15 minutes of it.


    The hardest part of the job remained dealing with… well, some of you. Customers felt entitled to raise their voices, use profanity, and commit Trumpian acts of rudeness toward my fellow employees and me. Most of our “valued guests” would never act that way in other public situations or with their own coworkers, no less friends. But inside that store, shoppers seemed to interpret “the customer is always right” to mean that they could do any damn thing they wished. It often felt as if we were penned animals who could be poked with a stick for sport, and without penalty. No matter what was said or done, store management tolerated no response from us other than a smile and a “Yes, sir” (or ma’am).

    The store showed no more mercy in its treatment of workers than did the customers. My schedule, for instance, changed constantly. There was simply no way to plan things more than a week in advance. (Forget accepting a party invitation. I’m talking about childcare and medical appointments.) If you were on the closing shift, you stayed until the manager agreed that the store was clean enough for you to go home. You never quite knew when work was going to be over and no cell phone calls were allowed to alert babysitters of any delay.

    And keep in mind that I was lucky. I was holding down only one job in one store. Most of my fellow workers were trying to juggle two or three jobs, each with constantly changing schedules, in order to stitch together something like a half-decent paycheck.

    In New York City, that store was required to give us sick leave only after we’d worked there for a full year — and that was generous compared to practices in many other locales. Until then, you either went to work sick or stayed home unpaid. Unlike New York, most states do not require such a store to offer any sick leave, ever, to employees who work less than 40 hours a week. Think about that the next time your waitress coughs.


    Minimum Wages and Minimum Hours

    Much is said these days about raising the minimum wage (and it should be raised), and indeed, on January 1, 2016, 13 states did raise theirs. But what sounds like good news is unlikely to have much effect on the working poor.

    In New York, for instance, the minimum went from $8.75 an hour to the $9.00 I was making. New York is relatively generous. The current federal minimum wage is $7.25 and 21 states require only that federal standard. Presumably to prove some grim point or other, Georgia and Wyoming officially mandate an even lower minimum wage and then unofficially require the payment of $7.25 to avoid Department of Labor penalties. Some Southern states set no basement figure, presumably for similar reasons.

    Don’t forget: any minimum wage figure mentioned is before taxes. Brackets vary, but let’s knock an even 10% off that hourly wage just as a reasonable guess about what is taken out of a minimum-wage worker’s salary. And there are expenses to consider, too. My round-trip bus fare every day, for instance, was $5.50. That meant I worked most of my first hour for bus fare and taxes. Keep in mind that some workers have to pay for childcare as well, which means that it’s not impossible to imagine a scenario in which someone could actually come close to losing money by going to work for short shifts at minimum wage.

    In addition to the fundamental problem of simply not paying people enough, there’s the additional problem of not giving them enough hours to work. The two unfortunately go together, which means that raising the minimum rate is only part of any solution to improving life in the low-wage world.

    At the store where I worked for minimum wage a few years ago, for instance, hours were capped at 39 a week. The company did that as a way to avoid providing the benefits that would kick in once one became a “full time” employee. Things have changed since 2012 — and not for the better.

    Four years later, the hours of most minimum-wage workers are capped at 29. That’s the threshold after which most companies with 50 or more employees are required to pay into the Affordable Care Act (Obamacare) fund on behalf of their workers. Of course, some minimum wage workers get fewer than 29 hours for reasons specific to the businesses they work for.


    It’s Math Time

    While a lot of numbers follow, remember that they all add up to a picture of how people around us are living every day.

    In New York, under the old minimum wage system, $8.75 multiplied by 39 hours equaled $341.25 a week before taxes. Under the new minimum wage, $9.00 times 29 hours equals $261 a week. At a cap of 29 hours, the minimum wage would have to be raised to $11.77 just to get many workers back to the same level of take-home pay that I got in 2012, given the drop in hours due to the Affordable Care Act. Health insurance is important, but so is food.

    In other words, a rise in the minimum wage is only half the battle; employees need enough hours of work to make a living.

    About food: if a minimum wage worker in New York manages to work two jobs (to reach 40 hours a week) without missing any days due to illness, his or her yearly salary would be $18,720. In other words, it would fall well below the Federal Poverty Line of $21,775. That’s food stamp territory. To get above the poverty line with a 40-hour week, the minimum wage would need to go above $10. At 29 hours a week, it would need to make it to $15 an hour. Right now, the highest minimum wage at a state level is in the District of Columbia at $11.50. As of now, no state is slated to go higher than that before 2018. (Some cities do set their own higher minimum wages.)

    So add it up: The idea of raising the minimum wage (“the fight for $15”) is great, but even with that $15 in such hours-restrictive circumstances, you can’t make a loaf of bread out of a small handful of crumbs. In short, no matter how you do the math, it’s nearly impossible to feed yourself, never mind a family, on the minimum wage. It’s like being trapped on an M.C. Escher staircase.

    The federal minimum wage hit its high point in 1968 at $8.54 in today’s dollars and while this country has been a paradise in the ensuing decades for what we now call the “One Percent,” it’s been downhill for low-wage workers ever since. In fact, since it was last raised in 2009 at the federal level to $7.25 per hour, the minimum has lost about 8.1% of its purchasing power to inflation. In other words, minimum-wage workers actually make less now than they did in 1968, when most of them were probably kids earning pocket money and not adults feeding their own children.

    In adjusted dollars, the minimum wage peaked when the Beatles were still together and the Vietnam War raged.


    Who Pays?

    Many of the arguments against raising the minimum wage focus on the possibility that doing so would put small businesses in the red. This is disingenuous indeed, since 20 mega-companies dominate the minimum-wage world. Walmart alone employs 1.4 million minimum-wage workers; Yum Brands (Taco Bell, Pizza Hut, KFC) is in second place; and McDonald’s takes third. Overall, 60% of minimum-wage workers are employed by businesses not officially considered “small” by government standards, and of course carve-outs for really small businesses are possible, as was done with Obamacare.

    Keep in mind that not raising wages costs you money.

    Those minimum wage workers who can’t make enough and need to go on food assistance? Well, Walmart isn’t paying for those food stamps (now called SNAP), you are. The annual bill that states and the federal government foot for working families making poverty-level wages is $153 billion. A single Walmart Supercenter costs taxpayers between $904,542 and $1.75 million per year in public assistance money, and Walmart employees account for 18% of all food stamps issued. In other words, those everyday low prices at the chain are, in part, subsidized by your tax money.

    If the minimum wage goes up, will spending on food benefits programs go down? Almost certainly. But won’t stores raise prices to compensate for the extra money they will be shelling out for wages? Possibly. But don’t worry — raising the minimum wage to $15 an hour would mean a Big Mac would cost all of 17 cents more.


    Time Theft

    My retail job ended a little earlier than I had planned, because I committed time theft.

    You probably don’t even know what time theft is. It may sound like something from a sci-fi novel, but minimum-wage employers take time theft seriously. The basic idea is simple enough: if they’re paying you, you’d better be working. While the concept is not invalid per se, the way it’s used by the mega-companies reveals much about how the lowest wage workers are seen by their employers in 2016.

    The problem at my chain store was that its in-store cafe was a lot closer to my work area than the time clock where I had to punch out whenever I was going on a scheduled break. One day, when break time on my shift came around, I only had 15 minutes. So I decided to walk over to that cafe, order a cup of coffee, and then head for the place where I could punch out and sit down (on a different floor at the other end of the store).

    We’re talking an extra minute or two, no more, but in such operations every minute is tabulated and accounted for. As it happened, a manager saw me and stepped in to tell the cafe clerk to cancel my order. Then, in front of whoever happened to be around, she accused me of committing time theft — that is, of ordering on the clock. We’re talking about the time it takes to say, “Grande, milk, no sugar, please.” But no matter, and getting chastised on company time was considered part of the job, so the five minutes we stood there counted as paid work.

    At $9 an hour, my per-minute pay rate was 15 cents, which meant that I had time-stolen perhaps 30 cents. I was, that is, being nickel and dimed to death.


    Economics Is About People

    It seems wrong in a society as wealthy as ours that a person working full-time can’t get above the poverty line. It seems no less wrong that someone who is willing to work for the lowest wage legally payable must also give up so much of his or her self-respect and dignity as a kind of tariff. Holding a job should not be a test of how to manage life as one of the working poor.

    I didn’t actually get fired for my time theft. Instead, I quit on the spot. Whatever the price is for my sense of self-worth, it isn’t 30 cents. Unlike most of this country’s working poor, I could afford to make such a decision. My life didn’t depend on it. When the manager told a handful of my coworkers watching the scene to get back to work, they did. They couldn’t afford not to.




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    Majority of U.S. Public School Students Live in Poverty

    February 19, 2016 // 14 Comments »

    education


    For the first time since the Great Depression, a majority of U.S. public school students come from low-income families, according to a new analysis of 2013 federal data, a statistic that has profound implications for the nation.

    The Southern Education Foundation reports 51 percent of students in pre-kindergarten through 12th grade in the 2012-2013 school year were eligible for the federal program that provides free and reduced-price lunches, a common indicator of food at-risk students living below the Federal Poverty Line.


    Bottom Feeders Not Fed

    “We’ve all known this was the trend, that we would get to a majority, but it’s here sooner rather than later,” said Michael A. Rebell of Teachers College at Columbia University, noting that the poverty rate has been increasing even as the economy has improved. “A lot of people at the top are doing much better, but the people at the bottom are not doing better at all. Those are the people who have the most children and send their children to public school.”

    Free, universal public education was a cornerstone of America’s growth, seeking to assimilate waves of immigrants and to provide them with the basic education needed in their day to participate in the economy, i.e., first an elementary education only, enlarged to include high school as demands changed. Things stalled out there.

    The trend toward majority-poor students in that public education system suggests further sorting out, at very early ages, of our once semi-egalitarian society into Haves (the one percent) and Have Nots (the 99 percent; the numbers are not that sharp yet, but definitely aimed that way.)

    Stupid people can’t get good jobs. But stupid people also do what they’re told to do, especially if they depend on you to keep their kids just barely out of starvation.


    We Don’t Need No Education

    In addition, the majority-poor schools are sliding away from their educational function and are becoming simply extension of the social services net.

    “When they first come in my door in the morning, the first thing I do is an inventory of immediate needs: Did you eat? Are you clean? A big part of my job is making them feel safe,” said Sonya Romero-Smith, a veteran teacher at Lew Wallace Elementary School in Albuquerque. Fourteen of her 18 kindergartners are eligible for free lunches. She helps them clean up with bathroom wipes and toothbrushes, and she stocks a drawer with clean socks, underwear, pants and shoes.

    Romero-Smith, 40, who has been a teacher for 19 years, became a foster mother in November to two girls, sisters who attend her school. They had been homeless, their father living on the streets and their mother in jail, she said. When she brought the girls home, she was shocked by the disarray of their young lives.

    “Getting rid of bedbugs, that took us awhile. Night terrors, that took a little while. Hoarding food, flushing a toilet and washing hands, it took us a little while,” she said. “You spend some time with little ones like this and it’s gut wrenching. These kids aren’t thinking, ‘Am I going to take a test today?’ They’re thinking, ‘Am I going to be okay?’”



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    Do the Math: American Economy and Society

    February 16, 2016 // 34 Comments »




    When most people talk about economics there are lots of statistics, as if economics is about math. Economics is really about people. It shows who we are as a nation and tells us what we will become. In 21st century America, our hope now is that we’ll someday better people than we have become. But do the math; it’ll be a hard road.

    In its most individual definition, jobs and work earn people money. They can feed themselves and their families, live inside and all the rest.

    But at a more societal level, a broader, more fundamental level, work is more. Work can define a person, work can give purpose, make someone feel useful, engage the resources of a society, create goals. You could almost call it a soul, knowing that work saved more lives than any preacher.

    The absence of work does just the opposite. People may be saved from starving by public assistance or charity (a vital part of society, caring for one another), but without purpose, they become cynical. They turn to drugs, legal like alcohol or illegal like meth, to replace the purpose and to fill the time. Without work, people give up. Rock bottom is a poor foundation for a nation to build on.


    So here’s what is happening in our America. See if you can figure out where this all leads to.


    Manufacturing was until the late 1970s the source of unprecedented wealth, spread proportionally across the economic spectrum in America. There were super rich people, and there were poor people, but there was also a thriving middle class that accounted for a huge section of our society. Without those jobs, economic apartheid, the one percent and the 99 percent, are inevitable.

    As just one example, since the 2009 taxpayer-paid bailout, General Motors has cut high-paid workers for cheaper labor, hiring. The automaker hired around 18,000 hourly production workers, allowing the company to remove skilled trade jobs. The Center for Automotive Research says General Motors Company saves approximately $57,000 a year per worker when it replaces a skilled $32 per hour union worker with a $15 per hour less-skilled, temp or non-unionized employee. These were once the “good jobs” that sustained a growing economy. They are gone. They have been replaced with…

    Service jobs. Service jobs do not create anything. They simply move some money from one hand to another, with a larger company taking a cut and sending the cash off to another city, another state, or another country. In 2014 America, manufacturing employs 1/10 of Americans. Services accounts for nearly 90%. America’s largest single employer in 1960 was General Motors. In 2014, it is Walmart. The “occupations” that account for the most jobs now are retail salespersons, cashiers, and restaurant workers. Those jobs pay minimum wage or less (for restaurant workers who can get tips), rarely offer any benefits and are rarely full-time.

    Working for subsistence wages, supplemented with public benefits, does not create value for humans. It is a modern-day form of feudalism, or perhaps more similar to raising livestock than growing a society.

    My book, Ghosts of Tom Joad: A Story of the #99 Percentconfronts these issues head on. The book is fiction, in that it wraps the economics and societal changes of the last fifty years into the story of one family. The book is all true in that what happens to that family, and in particular the main everyman character Earl, happened to millions of American families that believed the myths of growth, hard work and a sustainable middle class even as the super wealthy were pulling the money right out of their hands in front of their eyes. Ignore the rising waters, until you feel them up to your Katrina-like lips.

    Choosing to not believe something doesn’t make it go away.

    My book is set in Ohio, but the stories in it can be taking place today anywhere in the United States outside a few pockets of affluence centered on a few major cities, or a handful of growth industries such as government and defense.

    If you want to know where the 99 percent came from, this is part of the answer. Think of it as a good story, with a conscience.




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    A Kid is Dying in the Bronx.

    January 13, 2016 // 5 Comments »

    Mother_With_Her_Dead_Son



    A kid is dying in the Bronx.

    He was in a miserably poor and dangerous neighborhood. He shot at a cop, and the cop shot back. Now that’s the whole story, if you can understand it.

    I know his name from the news articles, but I’m not going to use it, because if I said his real name somebody reading this would say, “Oh, another Black kid,” and stop reading.

    I know the cop’s name from those same articles, which included a lot more information about the cop than the kid. The cop is going to be OK, luckily will heal up from his wounds, and in fact was struck by rounds fired by another cop, not the kid. That pretty much ended the media’s interest in much of a follow up story. “Cop Shooter Who Missed” is weak copy compared to “Cop Killer,” and somebody reading would say, well, that’s that. Mouse click and what was the score of the game? Sports is easier, every game has a winner.

    The media did take time to write about what they said were the circumstances of the shooting: street party, some fights got out of control, maybe something to do with gangs. They quoted a resident, who “spoke on the condition of anonymity because he feared for his safety,” and said that these kinds of things happen all the time in the neighborhood.


    Kid shot at a cop, and I make no effort here to justify that. Can’t and shouldn’t be done. But questioning isn’t justification, so I’m going to do that instead. If you thought about stopping reading this at “kid shot at a cop,” here’s where you likely will stop reading.


    But I want to know why there are square mile after square mile of miserably poor and dangerous neighborhoods in my city. They’re only a 15 minute subway ride away from where some of the richest people on earth – the Koch Brothers, a bunch of investment bankers whose names aren’t familiar – live. Among all that wealth, in 2016, why do we have such places? I looked for them in Tokyo and Ottawa, and while there are always rich and poor, there weren’t square mile after square mile. I did see something like them outside Nairobi and Delhi.

    I want to know why that part of the Bronx has charity-run drug clinics and liquor stores and payday loan storefronts and pawn shops and a few fast food places selling only carbs and fat as fuel as its only real commerce.

    I want to know why the only government offices in the neighborhood are a police station and an armed forces recruiting center.

    I want to know how a kid barely old enough to legally vote can illegally have a handgun.

    I want to know why a kid his age has a rap sheet that includes an assault on a cop in March 2015, a resisting arrest bust in September 2014 and another arrest in 2012 for another assault. The resisting charge has to do with him screaming “F*ck you, cops, I hate you all” but the news reports said nothing about the underlying event that brought the kid and the cops to that.

    The kid’s most recent bust came the day before he was shot, after he was arrested for skipping on a $2.75 subway fare. He was held overnight for that, released only a few hours before the party shooting, after a judge simply set him free. I want to know the thinking behind an arrest and 24 hour police detention for a subway fare.

    I want to know where the kid went to school. I want to know what happens in his home, what his parents say to him.

    I want to know why a kid would shoot at a cop, knowing the only two possible outcomes would be his own death or 20-to-life upstate.

    I want to know why we quickly ascribe these crimes to an individual without simultaneously asking why they happen so constantly and consistently across our society and not really any others.

    I want to know, amid the other daily news about celebrities and ISIS under every bed, why this all isn’t really news.

    We used say America was a place where anyone could grow up to be president. I’m not naive enough to believe that was ever really true, but I want to know if anyone thinks this kid ever had a chance to even grow up.




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    Israel Exported $400,000 of Gold to North Korea Despite UN Sanctions

    December 29, 2015 // 6 Comments »

    Gold_Bars


    So what do you call it when America’s bestest friend violates UN sanctions the U.S. pushed for by helping enrich America’s bestest enemy? And all the while the U.S. remains dead silent over the whole thing?

    Yep, bullsh*t.

    Israel has exported an estimated $400,000 worth of gold to North Korea in contravention of UN sanctions. Israeli ministers made the admission during a Knesset session after the UN had earlier questioned Tel Aviv on suspected exports to North Korea.

    “Unfortunately there have been exports of gold and sadly they were exposed and we had to give explanations to the UN,” David Houry, director of exports at the tax authority in Israel told the Knesset hearing.

    UN Security Council Resolution 1718 was passed in 2006 in response to North Korea’s program to develop nuclear weapons. The resolution prohibits exports of luxury goods. Precious metals are among the products barred from being sold to Pyongyang, along with alcoholic beverages, tobacco products, motor vehicles and perfumes. The theory behind the specificity of the sanctioned items is that they punish North Korea’s elite without affecting regular people. Except when Israel wantonly walks all over the rules.

    During the session the Knesset economics committee passed an order forbidding luxury exports to North Korea, nearly 10 years after the 2006 UN resolution.

    A spokesperson for Israel’s Economy Ministry, said the near decade-long delay in implementing the UN resolution was due to “bureaucratic difficulties.”




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    Christmas Spirit

    December 25, 2015 // 12 Comments »

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    I was eating in the food court below Grand Central Station in New York. There was a cold rain outside, and a good portion of the people around me appeared to be homeless.


    Many were making the rounds of the trash cans and tables, eating the food they found. There were cops nearby, as well as National Guardsmen on terror watch duty. There seemed to be a sort of understanding at work, such that the cops left the homeless alone as long as the homeless left the paying customers alone.


    I wasn’t going to finish my meal. There wasn’t much left, but some. What was the right thing to do?

    A) Leave the meal. A mouthful for someone hungry is better than nothing;

    B) Throw it away. It would have been embarrassing to offer a small amount available only because I’d already gorged myself;

    C) Go buy another full meal (I could afford it) and give it to one of the hungry people;

    D) Demand my government stop spending 54% of my taxes on war (actually more, if you consider black budgets, paramilitary forces, and intelligence costs) and start taking care of its own people. I have the resources to feed one person, but we have the resources to feed all Americans. If only we were willing. I don’t always know what’s right, but I know what is wrong.





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    Goodnight American Dream: The Middle Class Is Now a Minority

    December 14, 2015 // 7 Comments »

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    The middle class, which for 40 years has represented a majority of the country in practice, and formed the foundational belief in what has been known as the “American Dream,” is now just half the United States, according to a new report.

    Over at least the last four decades, productivity gains have gone largely to the top of the economic pyramid, increasing both their income and wealth. Real income growth has been flat for most Americans, even as the cost of living has increased.


    Need it in numbers?

    The share of America’s income going to the middle class has fallen from 62 percent in 1970 to 43 percent now. Today, the majority of our national income goes to the upper class, which reaps a 49 percent share. (by comparison, the share of income going to the upper class in 1970 was just 29 percent). The median wealth of middle class households has fallen by more than one-fourth since the beginning of this century.


    Need it in simple terms?

    The rich are getting very much richer, seeing their wealth grow exponentially. The middle class is shrinking. Meanwhile, the poor are still poor and their numbers are growing. We are indeed heading toward a society within a society within the world’s wealthiest nation — one percent of “us” now own half of everything.


    The implications of this path are dark.

    At the point where a handful of people control most of the wealth, and the other money in our nation is so diffuse as to make those individuals in the bottom 99 percent of our society irrelevant except as cheap labor, we live in a modern day version of feudalism. Money is power, and a select handful now can control elections with “donations,” can have laws written and rewritten to match their needs, can keep a lid on the minimum wage more and more of us depend on now to get by, manipulate college loan and mortgage rates to keep people in debt, and secure ownership of the land we live on and the places we live. Hyper-wealthy people through their charitable foundations are free to social-engineer our world, paying to say grow one form of educational system while leaving another to wither on limited funding.


    How did the wealthy pull off the greatest peaceful takeover of a nation in human history? Very easily. Their master stroke, however, was not to take predatory capitalism to its extreme, but to do so without sparking more than a whisper of disagreement from the very people they trod upon.

    Here is the linchpin of how the rich have taken us: they have convinced average Americans to act and vote against their own interests, in part by manipulating them into opposing any program that has a chance of benefiting black and brown equally or more than themselves. Decent health care and nutrition for everyone? That’s socialism!

    Our entire culture is fear-based, from our religion to our media to Wall Street. It drives everything, and fear is the most powerful tool that rulers can use to manipulate people. It is this constant state of fear that really makes us exceptional compared to every other advanced nation.

    People, we have been bought. Someone else now, in every effective and meaningful way, owns us. Suckers.



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    Here in Youngstown

    December 12, 2015 // 12 Comments »

    mill overgrown

    Ghosts of Tom Joad is fiction per se, but fiction based on fact. My story of the intentional destruction of an entire class of people through economic disparity is mirrored in so many people’s lives.

    Here is one of those stories, originally submitted to this blog as a comment, but well-worth repeating here (lightly edited):

    From 1955 to 1965, my Dad lived near Youngstown, Ohio. He moved up from the Mississippi Delta and worked at Packard Electric and some steel mills to get through college at Youngstown University.

    I drove through Youngstown last month for the first time after my Uncle’s funeral (submariner for six years, at Pearl Harbor, worked for 40 years at the General Motors Lordstown plant). Youngstown today reminded me of Detroit (as a firefighter, I tend to notice lots of empty lots where houses once stood).

    I graduated from high school in Detroit in 1983. The place has really gone even more downhill since 2008; my old house on the West side has been stripped out (dead dog carcass in the dining room), probably a 25 percent vacant rate.

    I don’t see things getting better anytime soon. I’m doing OK as a firefighter, but I’m making less than I did 13 years ago and the powers-that-be have been going after the public unions (now that less folks are in private unions than before the Great Depression).


    Here’s another from Comments:

    This blog resonates with me as I grew up in Troy, Ohio in the 1960s and ’70s before moving to New Jersey in 1974. I experienced small town America with Soap Box Derby races and Memorial Day parades and watching 4th of July fireworks from the levee on the Miami River. I went to college in Bethlehem, Pennsylvania, where “The Steel” ran the longest continuous steel mill in the world, something like 11 miles. A few years ago I read that the foundry part downtown had been turned into a casino and I knew that the U.S. was dying of capitalist rot.


    …And another:

    My long dead friend Joe was the son of the owner of a bar in downtown Lorain. My Polish friends had fathers that worked the steel mills. My high school used to play Admiral King, and my trip there was to the other end of the universe. The last several times in Lorain the major bridge was out for repair and it sure took a long time to fix it. I used to drive 6 and 2 driving to BGSU. Joe commented while dying that he remembered us tooling down that road doing 120 mph in my Detroit iron/389 Pontiac.Both of us were immigrant stock and soldiered for this country. Joe is still buried in Lorain with his parents.

    In October 2013 I stayed at Port Clinton and it was depressing. Half the business district was depressed. Tourism is down. A condo in town sold for $20K. Bowling Green town is dull and needs a paint job and new roofs. Cleveland is a slum, as is Euclid where my folks lived.The house I grew up in has been demolished. The inner city is every bit of what you wrote about, but worse. If that’s possible then things are really bad.



    There are so many, too many, such stories out there, good people who believed what they had been told only to find themselves discarded when companies found they could make more money somewhere, somehow else. They all are the ghosts of Tom Joad now.




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    Everything I Hate Happens Around Airplanes

    November 12, 2015 // 5 Comments »

    airline


    Everything I hate about who we have become as Americans happens around airplanes.


    Our Infrastructure

    Getting to any major airport not built in the last few years is a disaster. Utter lack of efficient public transportation is the norm. In most cases the best you get is an old, slow city bus with no room for luggage in place to ferry low-wage workers to their Cinnabon for the morning shift. Outside the big cities, you are lucky if you have even that. Either get there by private car, pay for a ride out the nose, or walk. Inside the airport, hah! Filthy toilets, lack of amenities, too hot/too cold/too crowded and usually smells like King Kong’s first dump of the day.


    Security Theatre

    OK, 9/11. So now 14 years later every airport is protected by petty thugs who make up rules that make little sense. We parade around dirty floors in bare feet, pour shampoo into little bottles, don’t bring water aboard but can buy it later for $5 a bottle, remove our laptops and belts, get x-rayed and scanned and whatever new was recently introduced. Or not. You can be randomly selected to just bypass a bunch of that, or if you can pay for some program so you can bypass all of that (nobody ever heard of sleeper agents?) or sometimes nobody checks and you bypass all that by “forgetting” to take your laptop out. Whatever. To avoid accusations of racial profiling while racial profiling, the occasional little old lady in a wheelchair is given the third degree.


    Our Apartheid of Money

    The airline will treat you less awful if you have money. Have it in the form of more frequent flier miles, the right credit card or the purchase of first class, and you have a shorter TSA line, get seated first, avoid the scrum when everyone else boards, don’t fight for overhead space and have your own elite potty. If all you have done is pay hundreds of dollars for a seat as a customer, to hell with you, get in the back and shut up.


    Selfishness

    To avoid the checked baggage fee, I am bringing aboard my entire drum kit, two giant stuffed pandas, a live goat and a couple of taped together cardboard boxes with grease stains. If my zone is called before yours, no overhead space for you, so Suck. It. The cabin attendants have no interest in refereeing fights, so back off or swing hard, your call.


    Selfishness, Part II

    If I want to eat fried snake bladder and garlic aboard, that’s my privilege. If I want to recline my seat into your face, I will. If I haven’t showered in a month and mouth-breathe, too bad. If I am so obese that I literally drip over the armrest, deal with it. If my kids want to kick you, vomit, scream or demand treats unavailable at 40,000 feet, throughout an entire 12 hour flight, I have no obligation to deal with that. And oh yes, waiting until you are on an airplane is exactly when you should clip your nails.


    People Don’t Care About Their Job

    Here’s a can of soda. Never ask me for anything ever again during this flight or I’ll claim you are disruptive and have security haul you away. Sort out your own carry-on and intra-passenger issues. Just stare straight ahead if your screen does not work. Once we land, fight your way to the front of the plane to get off eight seconds before someone else, I don’t really care what you do. I’ll be in the back complaining to the other cabin attendants about my job and eating Chipotle I brought aboard and which I alone am allowed to microwave.



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    How Much Money Do You Need to be Rich?

    November 10, 2015 // 5 Comments »

    scroogemcduck


    We hear a lot about the “one percent” and the “99 percent” but what kind of net worth scores you a top slot in the real-life Hunger Games here in America? How much money do you need to be just average? The answers tell you just about everything you need to know about modern day America.

    Short answer: Oh, we’re so screwed.


    The Federal Reserve’s 2013 Survey of Consumer Finances released in September of 2014 is among the most recent data. The nice folks who compiled all of this waded through massive amounts of data. They caution they did not include 11 ultra high net worth individuals due to identity issues whatever that means, so the very top of this accounting could actually be even worse in reality. And don’t forget, the super-rich have had two whole years to accumulate even more money since this all was tabulated.

    Let’s start at the top. The term “one percent” is now semi-meaningless, though you will need about $8 million to join them anyway. What really matters now is the top .1 percent. To crack that level you need to have well over $30 million in net worth.

    But I get it, no one here is packing those kind of bucks. We’re all sort of average Americans, right? Maybe. To count yourself in at the 50 percent mark you need to possess some $82,000. How are we doing, students and young marrieds? Keep in mind net worth is what you own minus what you owe, not necessarily how much money you earn. So those students loans and that VISA card debt count against your ranking here, sorry.

    The good news is that if you own nothing, have no savings or investments but also have no debt — you are precisely at zero — you are in the 11.8th percentile of net worths. Yep, that means about 11 percent of us have negative net worths. About a third of us have a net worth of only $15,000, not exactly a significant bumper against some bad luck, like losing your job or getting sick.

    It’s a pretty bleak picture, but here it is:




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    Wealth Therapists Now Exist to Help Super Rich Cope with Hardships

    October 24, 2015 // 5 Comments »

    scroogemcduck
    Sure, 99 percent of us have problems: Can we feed our kids? Will we lose our home to predatory lending? How can we access decent healthcare? That sort of thing.

    But rich people have problems, too. Luckily, a group of brave psychiatric professionals, dubbed “wealth therapists,” have emerged to come to their aid.

     

    The UK Guardian (America’s best newspaper) profiled Clay Cockrell, a former Wall Street worker turned therapist, who spends his days helping New York’s wealthiest people.

    So what issues are America’s One Percent struggling with? Cockrell tells us there is guilt over being rich in the first place, which makes the rich feel that they have to hide the fact that they are rich. And then there is the isolation – being in the One Percent, it turns out, can be lonely.

    And the problem is growing. According to Oxfam, the richest One Percent have seen their share of global wealth increase from only 44 percent in 2009 to 48 percent in 2014. It will break 51 percent by next year.

    The wealth therapists also say things have only gotten worse for their clients since the debate over income inequality that has been spurred on by movements like Occupy Wall Street.

    “The Occupy Wall Street movement singled out the One Percent and painted them globally as something negative,” said Jamie Traeger-Muney, another wealth psychologist. “I am not necessarily comparing it to what people of color have to go through, but it really is making value judgments about a particular group of people as a whole.”

    Traeger-Muney specializes in the unique issues inheritors face. “You can come up with lot of words and sayings about inheritors, and not one of them is positive: spoiled brat, born with a silver spoon in their mouth, trust fund babies, all these things,” she said, adding “I am shocked by things that people say. If you substitute in the word Jewish or black, you would never say something like that.”

     

    Hyper-wealthy, we all feel your pain. Thus, today, we are all part of the One Percent. #WealthyLivesMatter (say the wealthy.)

     

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    Well, That was Awful: #DemDebate

    October 14, 2015 // 6 Comments »



    About the Democratic debate last night on CNN: Is this it? Is this the best the Democratic side of America can offer?


    Hillary

    I have to admit, by not screwing up, Hillary did well.

    She clung to her talking points tenaciously, brushed off any scandals (aided by CNN’s Anderson Cooper lobbing her softballs on the tough issues, and of course, Bernie absolving her of any email problems, the FBI investigation be damned), invoked her dead blue collar mom several times to the point where we were looking for the ghost to appear on stage, and absent a weird and untrue story about her and Barack chasing down some Chinese fellas to yell at them about climate change, told no apparent whoppers. She even made a funny about how long it takes us ladies to pee pee between commercials.

    She did muff on Wall Street, claiming oddly she “represented Wall Street” as Senator. That line will live on in a thousand Republican attack videos. In that same little speechlet, Hillary also mentioned in 2007 she went down to Wall Street and told them to “cut it out,” in relation to the massive financial crisis dumped on American a year later.

    Her statements about how well Libya worked out, and how she personally took down bin Laden with a rusty switchblade, were utterly false, but whatever, she’s said all that before. She did not shapeshift into her lizard form, and thus was the debate’s big winner.


    Bernie

    Bernie. Oh Bernie.

    Bernie played to his loyal base and left the vast pool of others disappointed. At times he sounded like your drunk old hippy uncle, ranting about revolution. His most salient points, about climate change and the one percent, were often shouted. One could imagine the spittle that some poor stagehand had to swipe off the lectern afterwards. It is very unclear how many voters Bernie persuaded to switch over to him. He instead cemented his place in history as an “issue” candidate, one who runs to push some ideas further into the mainstream with no hope of actually winning.

    Bernie’s ideas are good. But he needed to show enthusiasm, righteous anger, and instead we just got a lot of bitching. See ya, Bernie, you have achieved footnote-in-the-history-books status for all time.

    The Others

    The others really should have just stayed home. They were the equivalent of the Star Trek red shirts, background actors filling out scenes, handy to have around when a scriptwriter needs to kill someone off.

    Martin O’Malley was running for something, maybe Hillary’s foot massager come 2016, but stumbled to make any real points. He sounded desperate about his turn as Baltimore’s mayor, saying things were actually pretty good then. Come on Martin, we’ve all seen The Wire.

    Lincoln Chafee — brother, it is over, if it had ever begun. When you explained you flubbed an early vote in Congress because you were new and your dad had died, you sounded like an undergrad begging his Psych 101 prof for extra credit.

    Then there was Jim Webb, the man who has overnight spawned a million Tweets. Webb was angry. Webb whined about not getting called on. Webb didn’t seem to remember his kids’ names. Webb dragged his wife into this, twice, the only family member pictured out the audience unless someone was related to the Santa Claus guy. But Webb saved the best for last, playing out his PTSD live on stage, grinning manically while explaining how he killed a man in Vietnam. Get some help, Jim, we’re worried about you, man.


    CNN

    And no props to CNN. A full thirty minutes of trash and commercials before the debate proper started? Why not bring out some Vegas showgirls? Letting Obama do a full-on promo piece saying “Vote Democrat?” Having their Official Black Guy Reporter Don Lemon ask one and only one question about #BlackLivesMatter? Then having the Official Hispanic guy (“Gracious, Anderson”) do the questions about weed and illegal immigration? And no questions at all about Israel, the Palestinians, the current war in Iraq, Afghanistan, or Planned Parenthood?


    The only question left: what was Joe Biden, watching this all at home, thinking?



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    Maine Outlaws Jet Skis for Welfare Recipients

    October 10, 2015 // 4 Comments »

    oliver-twist-please-sir-can-i-have-some-more-begging-bowl

    In another step in the long political tradition of imposing bombastic, faux populist, hate-mongering solutions to problems that don’t really exist, Maine Governor Paul LePage announced he is tired of able-bodied food stamp recipients zipping around on jet skis instead of looking for jobs that do not exist.


    His state thus proudly announced it will disallow Supplemental Nutrition Assistance Program (SNAP, the official term for food stamps) benefits for childless households with certain assets worth more than $5,000. A home equity and a person’s primary vehicle (but what if that vehicle is a $1.5 million Ferrari?) won’t count against the limit, but the state has issued a list of things that could: “bank accounts, snowmobiles, boats, motorcycles, jet skis, all-terrain vehicles, recreational vehicles, campers” and other valuables.

    “Hard-working Mainers should not come home to see snowmobiles, four wheelers or jet skis in the yards of those who are getting welfare,” LePage said in a statement. Left out of course is how those “hard-working Mainers” know exactly how is getting welfare among jet ski owners, but, whatever, when you are inciting hatred you don’t sweat the details.


    OK. So if you are poor, you need to become poorer to get food assistance, because, sure if you have more than $5,000 bucks worth of whatever you are rich enough. The, after those one-time sell offs of your assets for pennies on the dollar to richer folks, you are then poor enough for welfare. Circle of life kinda stuff.

    Of course all this righteousness begs the question of how many SNAP recipients in Maine have jet skis in their yards. Exactly how many?

    “We hear examples and concerns from clients and constituents quite frequently,” a spokesperson for the governor replied. He declined to give a number, or an estimate, or to cite even one specific case.

    He also declined to answer the “So what?” question; so what if someone who needs food assistance has minimal assets. Is the idea that one needs to sell off everything one owns, down to the walls, and only then ask for something to eat? How the f*ck mean of a society are we?

    Federal law imposes resource limits for SNAP eligibility, but states generally waive the limit for applicants if they already qualify for even modest assistance from another means-tested safety net program. It’s a policy called broad-based categorical eligibility, and most states offer it.

    In the aftermath of the Great Recession, almost all states also waived time limits on food stamp benefits for able-bodied adults without dependents, and those limits are coming back now that the unemployment rates are falling. LePage’s administration imposed the time limit — billed as a “work requirement” — ahead of schedule, ending benefits for 9,000 Mainers this year.


    Oh, and about those jobs. Minimum wage in Maine is $7.50 an hour. Most minimum wage jobs offer 29 or fewer hours a week. So, even before taxes, that works out to $217 a week. Assuming a full 52 weeks of employment, that adds up to $11,310. So hah hah, the poverty line in Maine for one person is $11,945.

    “What’s next? Grandma can’t buy groceries until she sells her engagement ring?” said Representative Drew Gattine, a Democrat who co-chairs the state legislature’s Health and Human Services Committee. (Answer: No. For no apparent reason, jewelry will not count toward the asset limit in Maine.)


    Now, one more question.

    How much in free food benefits are those lazy ass jet skiers in Maine sucking up? In other words, how much money will the new system in Maine save those angry tax payers, especially given the bureaucratic infrastructure needed to discover who has assets such as jet skis, and then to process them out of the SNAP system, lousy free-loaders?

    The average person in Maine receives all of $122.79 a month in food benefits.




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    Kansas Bans Poor People from Spending Welfare on Cruise Ships

    October 3, 2015 // 17 Comments »

    child

    There is a myth that welfare is a good deal, money for nothing.

    Maybe to some it works that way, but in Kansas a family of three gets a maximum of $429 a money in cash, about $35 bucks a person a week. I don’t know, I guess that is one way to live, but not a way too many people want to live.

    But if you are one of the people who thinks that is still too generous, boy has Kansas got some new laws for you.


    Haters Gonna Hate Once Elected

    Kansas welfare recipients will be unable to withdraw more than $25 per day in benefits under a new law sent this week to Governor Sam Brownback by the state legislature. Like most states, Kansas distributes benefits via a debit card.

    The bill also prohibits welfare recipients from spending their benefits at certain types of businesses, including liquor stores, fortune tellers, swimming pools and cruise ships.

    “We’re trying to make sure those benefits are used the way they were intended,” one state representative said. “This is about prosperity. This is about having a great life.”

    Under the new rule, a family receiving the maximum benefit would have to go to the ATM more than a dozen times to get the full benefit, which would be whittled away by an 85 cent fee for each withdrawal after the first one. And since many recipients do not have bank accounts, they will pay an ATM fee on top of that for each withdrawal. If you figure $3 (+.85) a transaction, times 12 pulls, that’s about $46 a month, a de facto reduction of benefits of more than ten percent for no real reason whatsoever.

    The federal welfare reform law of 1996 gave states significant leeway to design their own programs. Missouri, for example, is considering a bill to forbid food stamps from being spent on steak or seafood. No more cheap fish heads for you! But even welfare advocates were taken aback by the $25 daily limit in Kansas, something that has not been implemented in any other state.

    “This provision makes it nearly impossible for a recipient who does not have a checking account to pay rent,” said Liz Schott of the Center on Budget and Policy Priorities. The Kansas provision originally would have limited daily benefits to $60, but that was reduced through an amendment.


    The Questions

    We’re left with some questions.

    I’m pretty sure no one thinks it would be right for welfare recipients to spend benefits designed to feed hungry people at liquor stores, fortune tellers, swimming pools or cruise ships. One wonders, however, at the codification of that into law. Do the Kansas benefit cards even know they are in an ATM on the Love Boat versus one at the grocery store? Is there in fact even one case of a welfare receipt spending his money on a cruise? At a maximum of $429 a month, it seems hard to save up the thousands of dollars cruises cost, especially given the airfare from Kansas to the nearest ocean. And since you can withdraw cash and then spend it on booze or fortune telling if you really want to, isn’t the whole thing pointless?

    The $25 daily limit is also a bit unclear. That amount of money doesn’t get you very far at the grocery store, so it translates into little more than multiple trips each week plus the costs of ATM fees. That alone is at variance with trying to find or work a job, and child care. It does not seem to benefit anyone.

    So what is the point? Well, politics for sure. Nothing says Republican in Kansas apparently like being needlessly mean to poor people. A lot of votes in that hater demographic. Right along side that is the idea that poor people deserve to suffer somehow.

    So, Kansas, why not go for it? Why not just have welfare recipients publicly have to beg for money? Maybe something on TV, like American Idol, where the best beggar as voted on by the home audience gets an extra jar of peanut butter, or, as a special reward, a quick trip to the fortune teller?

    “The magic cards tell me your future looks… very bleak…”



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    What the Pope Almost Said

    September 28, 2015 // 1 Comment »




    In my last book, Ghosts of Tom Joad: A Story of the #99 Percent two characters are talking, Earl, the main guy, and his friend, Preacher Casey.

    What Casey said is pretty close to a lot of the things the Pope tried to say while he was in the U.S. last week, so I thought it might be worth reading here while the American media focuses ever-so-briefly on the plight of our poor, and the economy that made them that way.



    We understood that getting along meant you could only be so selfish, that only watching out for yourself just would not work in a place where we had to live together. Sermon on the Mount said all that Casey told me, but we did it on our own in a practical way. I guess you can make a life outta not getting along if you only read one book, hating on certain people because one page of the Bible says to, while ignoring the rest of what it says, which is pretty goddamn clear about love.

    Casey was still laughing on the bus when I remembered telling him that.

    Casey and me ended up talking a lot as we became friends. Casey read a lot of books. He seemed to understand things that had happened around me and my life in a way that made it clear that Reeve was not an island like we thought it was. In fact, what had happened to us here had happened to a lot of places. A “hollowing out,” Casey said, in a kind of sermon of his own:

    “Earl, money isn’t spread around like it used to be. After the war, until about the time you were in junior high school, incomes rose at the same level for everyone. But then things changed—you saw it, your mom and dad for sure. The top one percent of Americans watched their income grow dozens of times more than the rest of us, until that same small group of people held forty percent of all the
    wealth in the U.S.”

    “Look at Detroit,” Casey went on, “my old hometown. The U.S. emerged from the Second World War with Heaven’s only functioning army, with more than half of the industrial capacity in the world and as banker and creditor to allies and enemies. That was the highest hill our country climbed, and Detroit sat at the summit. Detroit was looking into a future where the rising prosperity was going to fuel a demand for cars unlike any consumer demand in human history. There was so much money and growth and potential that everyone ate well.

    “When it rains like that, people can’t help but get wet. My own father started as a toolmaker’s apprentice right after high school and ended up making $35 an hour, with a pension, health care, employee discounts on the cars he helped build and a union picnic every Fourth of July.”

    “Detroit rode that all up until about 1973, when everything went over the hill, not just in Detroit, but most everywhere — wages fell, benefits fell, production fell, population fell, home values fell. You can buy a house in Detroit for $6,000 today. Greatest generation and all, no, they were the greatest exception. It all happened quickly, in only the course of a few decades, two or three generations. My dad got out okay, but my older brother didn’t. He told me he felt thrown away, that he never thought this was so fragile. I hate to say it so crudely — God forgive me — but America lost its balls.”

    “C’mon Casey,” I said, “that’s what business does, even I know that. It’s their job to make as much money as they can for them, not for us. A dog can’t help being a dog, so you don’t kick at him for peeing on a tree, right?”

    “Earl, I’m not talking about anything radical here. I’m talking about a little bit of a balance. Those fights between your mom and dad over money you told me about, they were real. They were talking to each other about what was happening in America, all around them, without even knowing it. A very few people were choosing for them. Business became all appetite.

    Now we are reaching for a zero-sum point where wealthy people believe that to gain anything requires them to take it from someone else. Wal-Mart already makes billions, but it fights even tiny increases to the minimum wage. If McDonald’s doubled its employees’ salaries to $14.50 an hour, a Big Mac would cost only 68 cents more.

    “Actually, even all this talk about minimum wage is missing a big point: more Americans work for sub-minimum than for minimum wage. People who might get tips only have to be paid $2.13 an hour in some places. And that $2.13 has not changed by law in twenty-two years due to lobbying by the restaurant business. Owners are doing okay, as restaurant prices have gone up in the last twenty-two years. Just like in Roman times, the lion’s share beats the Christians’ share any day.”

    “This is where my religious and political views meet up, Earl. Most wealthy folks say they’re religious people, but when the churches are rich and the regular people poor, you gotta wonder who is serving who. Most of those wealthy ignore one of the highest ideals from the Sermon — caring. Those words aren’t just some more poetry of hopefulness that passes for Christianity. He said quite clearly, ‘they who hunger and thirst for righteousness, they should be satisfied.’ But it ain’t just about handing over a few crumbs, saying it’s better than no bread at all.

    “Getting into Heaven isn’t about earning merit badges, here’s one for those canned goods you didn’t want anyway at Christmas or another for tossing change into a cup. It’s about how you live a life in total, what you do 99 percent of the time, what you make of the world you live in. It isn’t religion that’s wrong, same as it isn’t business that’s wrong. It’s greed and selfishness that’s wrong, no matter what channel you’re watching.”

    I always thought the Bible was like the dictionary, all the words was inside and you could scramble them around to mean anything you like, but Casey made sense.

    “Look Earl, even though the original Owner was barefooted, what happens upstairs in my church is that as soon as some expensive shoes hit that floor it seems like the place loses its purpose. Me, I preached for the Lord a long time, but some days I think God’s the laziest man on earth. What I want is to be able to look out over my congregation and say to them forget most of what I’ve said but go out and be kind to each other, help each other and walk humbly when you have something others still need. When they hear someone cry in America because they’re hungry, I want that to be louder in their ears than any sermon.”

    “So okay, Preacher, when’s it going to get better? When are we going to be able to live like our grandparents did?”

    “Earl, nostalgia isn’t history. This is a story about change, and it’s important for you to know how that happened. Here we are forty years on still talking about recovery like it was as real as an election year promise. Prosperity is not something that will follow if we simply wait long enough. Like my friend says, cut through all the lies and there it is, right in front of you: America used to be a developing nation, in the best sense of that word.

    “Almost in spite of themselves, the robber barons built prosperity through jobs. We had to get past the horrors of enslaving other human beings, past making children work in factories, past killing men in mines and machines. There were dark times, criminal times, but people had a sense of ‘we’ll get past this.’ Then we crossed a line. Manufacturing in America became expensive. Businesses sought lower costs and higher profits. String
    that out as far as it goes and it means paying workers as close to zero—or zero if you somehow could like with slavery — and pulling in as much profit — as close to one hundred percent — as you somehow could. The question seemed to have become, ‘How many miles can you drive on a gallon of our blood?’

    “We watched a reversal of two hundred years. American workers never earned as much again as they did in 1973. It was soon after that someone laid off a steelworker who became Patient Zero of the new economy.”

    “The numbers are too consistent, the lines too straight. This was no accident, no invisible hand. Earl, we changed from a place that made things —radiators, cash registers, gaskets, ball bearings, TVs — into a place that just makes deals. Making things creates jobs, and jobs create prosperity. Making deals just creates wealth for the dealers. It’s math. The money that went up had to come from somewhere. That was right out of your father’s pocket.

    “The deal makers don’t care because they don’t live here, hell, they don’t live anywhere. We live here.”




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    Arizona Spent Over $1.7 Million Drug Testing Welfare Recipients to Catch 1 Person in 3 years

    August 12, 2015 // 3 Comments »

    drug-test-2-972x648


    Somehow in America if you are poor and in need of food, you better not take drugs, or no public assistance for you! You deserve to die of hunger because you spend your money on ‘da dope.

    Just don’t die in the street where we have to step over your body on the way to the nail salon.

    Oh, and by the way, this is a wholly made up problem created by frightened politicians. According to a study by the National Institute of Alcohol Abuse and Alcoholism, differences between the proportion of welfare and non-welfare recipients using illegal drugs are statistically insignificant.


    But that did not stop Arizona.

    Arizona proudly claims it spent $1.7 million dollars to test 87,000 people on public assistance for drug use. The total number of drug cheats caught in the first three years of the program, 2009-2012, was exactly onea single positive result, which saved the state precisely $560, minus the $42 cost of the drug test itself. But oh my, since 2012, they got two more of the danged varmints.

    Luckily, the Arizona drug testing is being done in a scientific way. The state asks new welfare recipients whether they’ve used drugs in the past 30 days, and only those who answer yes are tested.

    Now the goody-goodest news of all is that Arizona apparently has got them some cheap drug testing. The ACLU estimates that an average drug test costs $42, bringing the total cost as high as $3.65 million if all of the Arizona welfare recipients were subjected to the full-price tests. But who knows,maybe there was GroupOn.

    And luckily the money being spent on these drug tests is not going to feed hungry people, so it’s not being wasted on American who are wasted.


    It is not just Arizona who wastes taxpayer money to solve a non-problem. Have a look:


    Missouri
    Applicants for benefits that required drug screening, March 2013–September 2014: 69,587
    Total required to take follow-up drug test at additional cost: 1,646
    Disqualified due to a positive drug test: 69

    Utah
    Applicants for benefits that required drug screening, August 2012–July 2014: 9,253
    Total required to take follow-up drug test at additional cost: 1,878
    Disqualified due to a positive drug test: 29

    Tennessee
    Applicants for benefits that required drug screening, July 2014–December 2014: 11,300
    Total required to take follow-up drug test at additional cost: 273
    Disqualified due to a positive drug test: 24

    Florida
    Applicants for benefits that required drug screening, July 2014–December 2014: 4,044
    Total required to take follow-up drug test: Unknown
    Disqualified due to a positive drug test: 108

    The neat thing is that Florida used to (they were stopped by court order) requires welfare applicants, who have little money hence the application, to pay for their own drug tests up front. If they passed the test, they eventually had their money refunded.


    Note that if you can afford your own food, take all the drugs you want. Smoke up, Arizonians, and order that pizza delivered when you get the munchies. Damn hippies.




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    Casinos Fail Old Industrial Towns

    July 14, 2015 // 5 Comments »

    sands casino


    It wasn’t just a business, it was a way of life– what residents of Bethlehem, Pennsylvania referred to simply as “The Steel”– a mill once America’s second largest steel producer with 31,500 souls working in a single facility.


    The Mill

    The mill made the steel for the Empire State building and the Golden Gate Bridge, and for WWII warships. After cheap imports flooded the United States in the 1980s, the Bethlehem Steel facility closed, leaving behind a mile-long scar of rusted out buildings people call the brownfields, along the Lehigh River. Allentown, Billy Joel’s bitter saga of industrial decline, name-checked the town.


    The Promise of Legalized Gambling

    So as soon as Pennsylvania legalized casinos in 2004, Bethlehem scrambled for one of the first, and won. Symbolically, Las Vegas’ Sands corporation would build right on top of the old mill. Everyone hoped the casino would replace a decent portion of the jobs lost when The Steel left. But by 2014, there were only 2,200 positions at the casino, plus 700 at leased businesses inside. Was a casino really the answer?

    Even those new jobs didn’t come for free. Roads, some $10 million worth, had to be built or repaired to make it easier for out-of-towners (New York is only 75 miles away) to reach the casino. The city added to its police force. Since the casino was located outside the downtown business district, the city paid for a shuttle bus to try and draw players to their shops. But the casino had its own retail mall competing with anything local. No one should “plan on a casino to bring about urban renewal,” said a Wynn Casinos property manager in nearby Philadelphia, “because that’s not what casinos do.”


    The House Always Wins

    Still, there was money to be made in Bethlehem. Casino profits, of course, were repatriated to the owners in Las Vegas. Pennsylvania requires casinos to pay a 55 percent tax on revenues, but only four percent of that goes to the host community. For Bethlehem in 2013, that totaled $9.5 million, not game-changing money for an area so economically devastated for so long. Baltimore, an early adopter of casino gambling as an economic resurrection strategy, has seen similar results. In Atlantic City, the first major destination outside Las Vegas to feature legalized gambling, four major casinos closed in the past year.

    Bringing in a casino is about jobs and money. Jobs created statewide in Pennsylvania via gaming do not even equal the number lost in Bethlehem alone. As of 2013, Pennsylvania casinos directly employed only 17,768 people, leaving significant questions about the role of gaming in lifting America’s devastated rust belt towns out of unemployment-driven malaise.

    As for money, a report notes that after some initial successes, revenues in Pennsylvania from gaming declined by 2013. Statewide, casinos did contribute about $81 million in taxes last year. However, it is unclear how much of the revenue behind those taxes came from local residents, what might be called churning rather than creation, a back-door tax on those ill-prepared to lose money at the slots (affluent people visit casinos less often than poorer people do.) One group of frequent visitors who have found a way to beat the house come from New York’s Korean community; they sell the promotional meal vouchers from the casino on the black market.

    Competition is a serious problem, as new casinos open in surrounding states. For example, New Jersey is considering a casino at the Meadowlands, only 30 minutes outside New York City, which will pull many away from Bethlehem’s new bright lights. Pennsylvania is also among the states with the highest casino tax rate in the nation, raising further the question of market cannibalization should gaming corporations seek out lower rates in adjoining states. Casino revenues nationwide have not recovered their 2007 peaks, and Moody’s projects a drop through 2015, cutting industry earnings by as much as 7.5 percent.


    Don’t Gamble if You Can’t Afford to Lose

    Only a generation ago, Bethlehem, Pennsylvania had a steel mill employing tens of thousands of people at good wages. Including benefits, an average union steelworker made $26.12 per hour then, the equivalent of $40.66 today. It was enough to create one of the most powerful economies on earth, supported by a robust middle class driving demand for housing, cars, everything. They could afford to gamble a bit on yearly vacations, too.

    The typical casino worker today in Bethlehem makes $10-12 an hour. Many are part-time. They labor in the shadow of the mill that helped build the Empire State building and the Golden Gate Bridge, a new way of life that may flounder on a bad roll of the dice.



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    Life in the New American Minimum-Wage Economy with the Ghosts of Tom Joad

    June 20, 2015 // 3 Comments »

    There are many sides to whistleblowing. The one that most people don’t know about is the very personal cost, prison aside, including the high cost of lawyers and the strain on family relations, that follows the decision to risk it all in an act of conscience. Here’s a part of my own story I’ve not talked about much before.

    At age 53, everything changed. Following my whistleblowing first book, We Meant Well: How I Helped Lose the Battle for the Hearts and Minds of the Iraqi People, I was run out of the good job I had held for more than 20 years with the U.S. Department of State. As one of its threats, State also took aim at the pension and benefits I’d earned, even as it forced me into retirement. Would my family and I lose everything I’d worked for as part of the retaliation campaign State was waging? I was worried. That pension was the thing I’d counted on to provide for us and it remained in jeopardy for many months. I was scared.

    My skill set was pretty specific to my old job. The market was tough in the Washington, D.C. area for someone with a suspended security clearance. Nobody with a salaried job to offer seemed interested in an old guy, and I needed some money. All the signs pointed one way — toward the retail economy and a minimum-wage job.

    And soon enough, I did indeed find myself working in exactly that economy and, worse yet, trying to live on the money I made. But it wasn’t just the money. There’s this American thing in which jobs define us, and those definitions tell us what our individual futures and the future of our society is likely to be. And believe me, rock bottom is a miserable base for any future.

    Old World/New World

    The last time I worked for minimum wage was in a small store in my hometown in northern Ohio. It was almost a rite of passage during high school, when I pulled in about four bucks an hour stocking shelves alongside my friends. Our girlfriends ran the cash registers and our moms and dads shopped in the store. A good story about a possible date could get you a night off from the sympathetic manager, who was probably the only adult in those days we called by his first name. When you graduated from high school, he would hire one of your friends and the cycle would continue.

    At age 53, I expected to be quizzed about why I was looking for minimum-wage work in a big box retail store we’ll call “Bullseye.” I had prepared a story about wanting some fun part-time work and a new experience, but no one asked or cared. It felt like joining the French Foreign Legion, where you leave your past behind, assume a new name, and disappear anonymously into the organization in some distant land. The manager who hired me seemed focused only on whether I’d show up on time and not steal. My biggest marketable skill seemed to be speaking English better than some of his Hispanic employees. I was, that is, “well qualified.”

    Before I could start, however, I had to pass a background and credit check, along with a drug test. Any of the anonymous agencies processing the checks could have vetoed my employment and I would never have known why. You don’t have any idea what might be in the reports the store receives, or what to feel about the fact that some stranger at a local store now knows your financial and criminal history, all for the chance to earn seven bucks an hour.

    You also don’t know whether the drug tests were conducted properly or, as an older guy, if your high blood pressure medicine could trigger a positive response. As I learned from my co-workers later, everybody always worries about “pissing hot.” Most places that don’t pay much seem especially concerned that their workers are drug-free. I’m not sure why this is, since you can trade bonds and get through the day higher than a bird on a cloud. Nonetheless, I did what I had to in front of another person, handing him the cup. He gave me one of those universal signs of the underemployed I now recognize, a we’re-all-in-it, what’re-ya-gonna-do look, just a little upward flick of his eyes.

    Now a valued member of the Bullseye team, I was told to follow another employee who had been on the job for a few weeks, do what he did, and then start doing it by myself by the end of my first shift. The work was dull but not pointless: put stuff on shelves; tell customers where stuff was; sweep up spilled stuff; repeat.

    Basic Training

    It turned out that doing the work was easy compared to dealing with the job. I still had to be trained for that.

    You had to pay attention, but not too much. Believe it or not, that turns out to be an acquired skill, even for a former pasty government bureaucrat like me. Spend enough time in the retail minimum-wage economy and it’ll be trained into you for life, but for a newcomer, it proved a remarkably slow process. Take the initiative, get slapped down. Break a rule, be told you’re paid to follow the rules. Don’t forget who’s the boss. (It’s never you.) It all becomes who you are.

    Diving straight from a salaried career back into the kiddie pool was tough. I still wanted to do a good job today, and maybe be a little better tomorrow. At first, I tried to think about how to do the simple tasks more efficiently, maybe just in a different order to save some walking back and forth. I knew I wasn’t going to be paid more, but that work ethic was still inside of me. The problem was that none of us were supposed to be trying to be good, just good enough. If you didn’t know that, you learned it fast. In the process, you felt yourself getting more and more tired each day.

    Patient Zero in the New Economy

    One co-worker got fired for stealing employee lunches out of the break room fridge. He apologized to us as security marched him out, saying he was just hungry and couldn’t always afford three meals. I heard that when he missed his rent payments he’d been sleeping in his car in the store parking lot. He didn’t shower much and now I knew why. Another guy, whose only task was to rodeo up stray carts in the parking lot, would entertain us after work by putting his cigarette out on his naked heel. The guys who came in to clean up the toilets got up each morning knowing that was what they would do with another of the days in their lives.

    Other workers were amazingly educated. One painted in oils. One was a recent college grad who couldn’t find work and liked to argue with me about the deeper meanings in the modern fiction we’d both read.

    At age 53, I was the third-oldest minimum-wage worker in the store. A number of the others were single moms. (Sixty-four percent of minimum-wage employees are women. About half of all single-parent families live in poverty.) There was at least one veteran. (“The Army taught me to drive a Humvee, which turns out not to be a marketable skill.”) There were a couple of students who were alternating semesters at work with semesters at community college, and a small handful of recent immigrants. One guy said that because another big box store had driven his small shop out of business, he had to take a minimum-wage job. He was Patient Zero in our New Economy.

    State law only required a company to give you a break if you worked six hours or more under certain conditions. Even then, it was only 30 minutes — and unpaid. You won’t be surprised to discover that, at Bullseye, most non-holiday shifts were five-and-a-half hours or less. Somebody said it might be illegal not to give us more breaks, but what can you do? Call 911 like it was a real crime?

    Some good news, though. It turned out that I had another marketable skill in addition to speaking decent English: being old. One day as a customer was bawling out a younger worker over some imagined slight, I happened to wander by. The customer assumed I was the manager, given my age, and began directing her complaints at me. I played along, even steepling my fingers to show my sincere concern just as I had seen actual managers do. The younger worker didn’t get in trouble, and for a while I was quite popular among the kids whenever I pulled the manager routine to cover them.

    Hours were our currency. You could trade them with other employees if they needed a day off to visit their kid’s school. You could grab a few extra on holidays. If you could afford it, you could swap five bad-shift hours for three good-shift hours. The store really didn’t care who showed up as long as someone showed up. Most minimum-wage places cap workers at under 40 hours a week to avoid letting them become “full time” and so possibly qualify for any kind of benefits. In my case, as work expanded and contracted, I was scheduled for as few as seven hours a week and I never got notice until the last moment if my hours were going to be cut.

    Living on a small paycheck was hard enough. Trying to budget around wildly varying hours, and so paychecks, from week to week was next to impossible. Seven hours a week at minimum wage was less than 50 bucks. A good week around the Christmas rush was 39 hours, or more than $270. At the end of 2013, after I had stopped working at Bullseye, the minimum wage did go up from a little more than $7 to $8 an hour, which was next to no improvement at all. Doesn’t every little bit help? Maybe, but what are a few more crumbs of bread worth when you need a whole loaf not to be hungry?

    Working to Be Poor

    So how do you live on $50 a week, or for that matter, $270 a week? Cut back? Recycle cans?

    One answer is: You don’t live on those wages alone. You can’t. Luckily I had some savings, no kids left in the house to feed, and my wife was still at her “good” job.  Many of my co-workers, however, dealt with the situation by holding down two or three minimum-wage jobs. Six hours on your feet is tough, but what about 12 or 14? And remember, there are no weekends or holidays in most minimum-wage jobs. Bullseye had even begun opening on Thanksgiving and Christmas afternoons.

    The smart workers found their other jobs in the same strip mall as our Bullseye, so they could run from one to the next, cram in as many hours as they could, and save the bus fare. It mattered: At seven bucks an hour, that round trip fare meant you worked your first 45 minutes not for Bullseye but for the bus company. (The next 45 minutes you worked to pay taxes.)

    Poverty as a Profit Center

    Many low-wage workers have to take some form of public assistance. Food stamps — now called the Supplemental Nutrition Assistance Program, or SNAP — were a regular topic of conversation among my colleagues. Despite holding two or three jobs, there were still never enough hours to earn enough to eat enough. SNAP was on a lot of other American’s minds as well — the number of people using food stamps increased by 13 percent a year from 2008 to 2012. About 1 in 7 Americans get some of their food through SNAP. About 45 percent of food stamp benefits go to children.

    Enjoying that Big Mac? Here’s one reason it’s pretty cheap and that the junk sold at “Bullseye” and the other big box stores is, too: Those businesses get away with paying below a living wage and instead you, the taxpayer, help subsidize those lousy wages with SNAP. (And of course since minimum-wage workers have taxes deducted, too, they are — imagine the irony — essentially forced to subsidize themselves.)

    That subsidy does not come cheap, either. The cost of public assistance to families of workers in the fast-food industry alone is nearly $7 billion per year. McDonald’s workers alone account for $1.2 billion in federal assistance annually.

    All that SNAP money is needed to bridge the gap between what the majority of employed people earn through the minimum wage, and what they need to live a minimum life. Nearly three-quarters of enrollments in America’s major public benefits programs involve working families stuck in jobs like I had. There are a lot of those jobs, too. The positions that account for the most workers in the U.S. right now are retail salespeople, cashiers, restaurant workers, and janitors. All of those positions pay minimum wage or nearly so. Employers are actually allowed to pay below minimum wage to food workers who might receive tips.

    And by the way, if somehow at this point you’re feeling bad for Walmart, don’t. In addition to having it’s workforce partially paid for by the government, Walmart also makes a significant portion of its profits by selling to people receiving federal food assistance. Though the Walton family is a little too shy to release absolute numbers, a researcher found that in one year, nine Walmart Supercenters in Massachusetts together received more than $33 million in SNAP dollars. One Walmart Supercenter in Tulsa, Oklahoma, received $15.2 million, while another (also in Tulsa) took in close to $9 million in SNAP spending.

    You could say that taxpayers are basically moneylenders to a government that is far more interested in subsidizing business than in caring for their workers, but would anyone believe you?

    Back in the Crosshairs

    Some employees at Bullseye had been yelled at too many times or were too afraid of losing their jobs. They were not only broke, but broken. People — like dogs — don’t get that way quickly, only by a process of erosion eating away at whatever self-esteem they may still possess. Then one day, if a supervisor tells them by mistake to hang a sign upside down, they’ll be too afraid of contradicting the boss not to do it.

    I’d see employees rushing in early, terrified, to stand by the time clock so as not to be late. One of my fellow workers broke down in tears when she accidentally dropped something, afraid she’d be fired on the spot. And what a lousy way to live that is, your only incentive for doing good work being the desperate need to hang onto a job guaranteed to make you hate yourself for another day. Nobody cared about the work, only keeping the job. That was how management set things up.

    About 30 million Americans work this way, live this way, at McJobs. These situations are not unique to any one place or region. After all, Walmart has more than 2 million employees. If that company were an army, it would be the second largest military on the planet, just behind China. It is, in fact, the largest overall employer in the country and the biggest employer in 25 states. When Walmart won’t pay more than minimum, it hurts. When it rains like that, we all get wet. This is who we are now.

    I Was Minimum

    It’s time to forget the up-by-the-bootstraps fantasies of conservative economists bleating on Fox. If any of it was ever true, it’s certainly not true anymore. There is no ladder up, no promotion path in the minimum-wage world. You can’t work “harder” because your hours are capped, and all the jobs are broken into little pieces anyone could do anyway. Minimum wage is what you get; there are no real raises. I don’t know where all the assistant managers came from, but not from among us.

    I worked in retail for minimum wage at age 16 and again at 53. In that span, the minimum wage itself rose only by a few bucks. What changed, however, is the cast of characters. Once upon a time, minimum-wage jobs were filled with high school kids earning pocket money. In 2014, it’s mainly adults struggling to get by. Something is obviously wrong.

    In his State of the Union Address, President Obama urged that the federal minimum wage be raised to $9 an hour. He also said that a person holding down a full-time job should not have to live in poverty in a country like America.

    To the president I say, yes, please, do raise the minimum wage. But how far is nine bucks an hour going to go? Are so many of us destined to do five hours of labor for the cell phone bill, another 12 for the groceries each week, and 20 or 30 for a car payment? How many hours are we going to work? How many can we work?

    Nobody can make a real living doing these jobs. You can’t raise a family on minimum wage, not in the way Americans once defined raising a family when our country emerged from World War II so fat and happy. And you can’t build a nation on vast armies of working poor with nowhere to go. The president is right that it’s time for a change, but what’s needed is far more than a minimalist nudge to the minimum wage. Maybe what we need is to spend more on education and less on war, even out the tax laws and rules just a bit, require a standard living wage instead of a minimum one. Some sort of rebalancing. Those aren’t answers to everything, but they might be a start.

    People who work deserve to be paid, but McDonald’s CEO Donald Thompson last year took home $13.7 million in salary, with perks to go. If one of his fry cooks put in 30 hours a week, she’d take in a bit more than $10,000 a year — before taxes, of course. There is indeed a redistribution of wealth taking place in America, and it’s all moving upstream.

    I got lucky. I won my pension fight with my “career” employer, the State Department, and was able to crawl out of the minimum-wage economy after less than a year and properly retire. I quit Bullseye because I could, one gray day when a customer about half my age cursed me out for something unimportant she didn’t like, ending with “I guess there’s a reason why people like you work at places like this.” I agreed with her: There is a reason. We just wouldn’t agree on what it was.

    I’m different now for the experience. I think more about where I shop, and try to avoid big places that pay low wages if I can. I treat minimum-wage workers a little better, too. If I have to complain about something in a store, I keep the worker out of it and focus on solving the problem. I take a bit more care in the restroom not to leave a mess. I don’t get angry anymore when a worker says to me, “I really can’t do anything about it.” Now I know from personal experience that, in most cases, they really can’t.

    Above all, I carry with me the knowledge that economics isn’t about numbers, it’s about people. I know now that it’s up to us to decide whether the way we pay people, the work we offer them, and how we treat them on the job is just about money or if it’s about society, about how we live, who we are, the nature of America. The real target now should be to look deeply into the apartheid of dollars our country has created and decide it needs to change. We — the 99 percent, anyway — can’t afford not to.




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    Posted in Afghanistan, Economy, Military