The Wrongologist

What’s
Wrong Today:

WNET is the NYC affiliate of PBS. It broadcasts on Channel 13 in the greater
New York area. WNET has a storied history, but it needs to adjust its moral compass, which is starting to point towards money, not
towards true north. WNET has (again) been caught doing the bidding of
plutocrats. From last Friday’s New York Times:

WNET said
production on the planned series, dubbed “Pension
Peril,” would be suspended indefinitely after journalist David Sirota of PandoDaily revealed the money
was coming from the Laura and John Arnold Foundation (LJAF). Arnold was an oil
trader at the disgraced Enron, who became one of the youngest billionaires in
the US. He is also a member of the WNET Board of Trustees.

Mr. Sirota
reported:

PandoDaily went on to report
that PBS and WNET had originally approached the foundation: (emphasis by the
Wrongologist)

Apparently,
Pension Peril will still be aired on public
television outlets, but the Arnold money will be returned. Pension Peril includes an episode on California public pensions. That segment discusses a ballot
initiative being pushed in the state to roll back public employee pensions − a campaign
being partially funded by, wait for it, John D. Arnold. The initiative
is run by San Jose Mayor, Chuck Reed (D), and Reed has thanked
“people from the Arnold Foundation” for putting him in touch with other
funders.

That’s not
a clear conflict of interest?

After the Arnold/pensions
relationship became public, PBS and WNET rethought having the Arnold Foundation
provide the funding for the Pension Peril
project. The Times reports that Stephen
Segaller, WNET’s VP for programming, said: (emphasis by the Wrongologist)

He added
that the grant had been solicited with “absolute conviction” that the
foundation was an acceptable funder. In other words, WNET still doesn’t believe
that there was any actual
conflict here — it just believes that there’s “a perception problem”. WNET is
returning the money because of “the optics” — which is to say, because Sirota’s
article came out, and it made both WNET and PBS look bad.

PBS’s
Ombudsman, Michael Getler wrote about the Arnold’s funding:

Apparently,
WNET’s management issue with the Arnold Foundation deal was not that the
content of the Pension Peril series
was too aligned with corporate interests, rather, it was the “optics” for WNET
and PBS!

This
shows us once again, the cynicism on the right. They have steadily campaigned
for the withdrawal of public funding from PBS since the Reagan administration. But, now that they have gotten the government off the horse, the right is busy saddling up.

This is not the first time that WNET
has had a problem with politically active plutocrats. In May, 2013, Jane
Mayer of the New Yorker wrote that two PBS-affiliated
documentaries featuring the Koch
Family came under pressure to be censored and edited due to fear that Charles
and David Koch, who, in addition to being the primary funders of conservative political
causes, are major donors to public media, would withdraw support.

David Koch has contributed to cultural and medical institutions including
Lincoln Center. In the 1980s, he expanded his charitable contributions to media,
donating $23 million to public television over the years. In 1997, he began serving as a trustee
of Boston’s public-broadcaster, WGBH, and he subsequently also became a trustee of WNET.

One film,
by Academy Award winning director Alex Gibney, Park Avenue: Money, Power &
The American Dream, received close scrutiny and was almost pulled, before
some edits and a compromise
format that included a rebuttal conversation at the program’s conclusion by Koch
and Sen. Charles Schumer (D-NY) were agreed by the producers and WNET.

Another
project, Citizen
Koch,
a documentary about the Citizens
United Supreme Court decision, was subject to editorial arm-twisting by
WNET representatives. Subsequently, WNET prevailed on ITVS, an independent
film production company based in San Francisco to withdraw funding of Citizen
Koch.

The film production
ultimately collapsed, and the producers’ statement said:

David
Koch was not mollified, and he resigned from the WNET Board of Trustees in May,
2013. Now, you could say that WNET is standing up to the plutocrats, since
David Koch was lost as a funding source, but consider the overriding issues:

First,
that public television is just another commercial mass media venture, one where
its advertisers are rich individuals and their foundations, instead of corporations
serving the mass market. As such, they have become very adept at creating programming
which represents the interests of their funding sources.

Second,
the management of WNET has lost focus on what independent journalism requires, tilting
toward the effort to fund its programming, instead the work of informing the
public.

He who pays the piper
will always call the tune. Soon, PBS could stand for the Plutocrat’s
Broadcasting Service.

What’s
Wrong Today:

Tom
Friedman is writing about economics again. In his Sunday Friedtastic Op-ed in the NYT, Mr. Friedman can’t contain his
enthusiasm for Silicon Valley and for “start-up America”. He begins
by telling readers:

After
giving a few examples, he says about San Jose’s entrepreneurs: (emphasis by the
Wrongologist)

Dean
Baker, in his reaction to the Friedman column:

If Mr. Friedman read
the business
section of the Times, he would
have known that Apple scoured the world for investment opportunities for their
billions and came up with a plan to buy back $40 billion of their stock.

Great innovation,
indeed.

Of
course great ideas are coming out of Silicon Valley. But they create very few jobs. In January, the Wrongologist wrote:

So,
the winners in Silicon Valley are a really just a few founders and their Venture Capital partners. After that, it’s
a few programmers, many of them immigrants on H1b visas. Just how many manicurists
and hair stylists, wait staff, gardeners and maids can the 11 Instagram
creators actually employ?

So let’s stop overemphasizing the billions on the table from innovative products developed in
Silicon Valley. Without a way to include the tens of millions of unemployed or
underemployed Americans, Silicon
Valley’s innovation will prop up the stock market, but it won’t prop up the
middle class.

Indeed,
all the techno-wow profits rolled up to 0.01% hasn’t helped and will not help
the middle class. All it did was move those 11 Instagram founders (among
others) to the uber-class.

The real
story in Mr. Friedman’s Op-ed is his calling out Washington for not supporting
the trade deals that corporations love. It is hardly surprising that Friedman
would strongly support the Trans-Pacific Partnership (TPP) and the
Trans-Atlantic Trade and Investment Pact (TTIP). He calls them “next
generation” trade agreements:

Then Mr. Friedman
quotes the Economist:

Does Mr. Friedman
think these numbers are for next year, or for 10 years out? He doesn’t tell us. For those who actually like their numbers to have a context, these projections are for somewhere around the middle of the next
decade when world GDP will be around $160 trillion and US GDP will be close to
$30 trillion.

That puts
the projected gains (if they are real) at a bit less than 0.4% of world GDP and
0.7% of US GDP. Not trivial, but hardly
the difference between a booming and a stagnant economy. In the
case of the US, the boost to GDP growth would be around 0.05 percentage points.

Hey, the
world is flat, everyone is hyper-connected, and why should facts matter?

Mr.
Friedman’s policy nostrums − multilateral trade agreements and additional
openness to immigration – will tend to expose American workers to more, rather
than less competition. Without simultaneous safeguards, the policies Friedman
favors may not enhance the welfare of American workers.

Dean Baker
wrote that Mr. Friedman makes no pretense of evaluating trade deals based on
evidence. Baker says that Friedman has proudly said just the opposite:  (emphasis by the
Wrongologist)

The
pursuit of cheap labor abroad has transferred wealth from US workers to
corporations. Mr. Friedman thinks we should import even more foreign workers to
replace the American workers who made our country great. Yet the children of
those American workers are loaded with education debt. They are being priced out of the global market.

The corporate bounty from cheap labor should be taxed, instead of
being tax sheltered by remaining offshore. Low tax rates should go with domestic
hiring at a living wage.

Tom
Friedman is popular because his articles are comforting to high-income metropolitan
elites. He focuses on big ideas, which we all love because of their simplicity.
He does not focus on the economic details, and it’s the details that get you
every time.

Mr.
Friedman raises one great point: Ideas can be tried and are celebrated if
successful in Silicon Valley. In Washington, politicians are afraid not just of
failure, but of imperfection. All ideas are picked apart.

That means that many good ideas cannot even be tried.

Take
Obamacare. The ACA was tried and is far from perfect. But what does the other
party do? It doesn’t promote any ideas that might improve it. It doesn’t suggest
a serious alternative. Instead, it tries to undermine the ACA for political gain.

Think
about it. Almost every important policy issue is treated the same way in
Washington. While in Silicon Valley, failure is treated as a learning
experience.

We’re
waiting, Tom Friedman.
Tell us how Comcast CEO Brian Roberts wakes up every day, reinventing himself
and Comcast’s broadband monopoly service by merging it with Time Warner,
another monopoly cable service, for the non-zero sum benefit of America.


What many Americans ask every day when they wake up, is not how to reinvent
themselves. They ask why the playing field has tilted so much since the last time they reinvented
themselves.

And when you’re done
asking yourself that, compare the result as you usually do, with those really bright
kids in third world countries, who don’t make as much money and live at a lower
standard. Ask how they are pushing American kids to the margins of
innovation.

Then ask American
multi-national firms why they are OK with that.

 

 

Our feel-good
tales about American Exceptionalism have entered a new chapter. People are
starting to talk about the American
Precariat, particularly, the NYT’s
David Brooks. The term describes people who feel that the ground beneath them
may be crumbling, so says Mr. Brooks:

Reports
are that Europe, that socialist haven of health care for all, may be passing us
(or matching us), in social mobility, and even in their faith in capitalism as
a successful economic model. More from Mr. Brooks:

Capitalism has been a useful and a powerful force. But
left unregulated, it can lead to bad decisions.

Here is today’s homily topic: Capitalism
is like the fisherman who uses dynamite to feed his family. He knows full well
the fish will be all gone before his children grow up, but he doesn’t care.

Cable industry consolidation won’t improve the little
guy’s life. Who cares?

Only way the main stream media covers joblessness:

Obamacare messaging depends on corporate message: (h/t Monty)

Missouri football player tackles NFL:

RIP Sid:

UN censures Vatican to no effect:

Boehner skates on Debt Ceiling increase:

What’s
Wrong Today:

The New York Times reports
that employees at the Chattanooga, TN Volkswagen plant voted 712 to 626 on
Friday against joining the United Automobile Workers Union.

The NYT quotes Mike
Jarvis, a VW employee who works on the finishing line:

His belief was that the
UAW had hurt Detroit’s automakers and killed Detroit. He may have been persuaded by Republican
politicians in Tennessee as well as some outside conservative groups, who made
sure that the plant’s workers heard plenty of anti-union arguments.

• Governor
  Bill Haslam, (R), warned that auto part suppliers would not locate in the
  Chattanooga area if the plant was unionized

• Sen.
  Bob Corker (R-TN) said Volkswagen executives had told him that the plant would
  add a new production line, making SUVs, if the workers rejected the UAW

• State
  Senator Bo Watson (R), who represents a suburb of Chattanooga, warned that the
  Republican-controlled legislature was unlikely to approve further subsidies to
  Volkswagen if the workers embraced the UAW, a threat that might discourage the
  company from expanding. Mr. Watson also attacked Volkswagen for taking a neutral-to-positive stance
  toward the UAW saying its approach was:

• Grover
  Norquist, the anti-tax crusader, helped underwrite a new group, the Center for
  Worker Freedom that put up 13
  billboards in Chattanooga, warning that the city might become the next Detroit
  if the workers voted for the union

Perhaps this pressure
made the majority of workers believe that they were voting in their own interest
by rejecting union membership. Mr. Corker had asserted that a union victory
would make Volkswagen less competitive and hurt workers’ living standards.

Volkswagen said that
it was neutral on the union vote, although they wished to implement a German-style works
council, a committee of managers and blue-collar and white-collar workers who
develop factory policies, on issues like work schedules and vacations.
Volkswagen, which has unions and works councils at all of its 105 other plants
worldwide, views such councils as crucial for improving morale and cooperation
and increasing productivity.

US Labor law experts say it would be illegal for VW to have a works council
unless workers first voted to have a union.

What we have here is the triumph
of political marketing over union marketing. Did the politicians interfere with
what is arguably an internal company issue; whether to organize a company
union? That will be decided over the next few weeks as the UAW looks at whether
it can file and win an NLRB complaint alleging improper influence over the
voting process.

Perhaps Charles Pierce
summed up the Tennessee situation best when he tweeted:

Broadening
this out, the idea that Americans are not responsible for what is happening in
America is a big cop-out. Who is responsible if we as individuals are not
responsible? Should we simply blame the moneyed interests? Ian
Welsh observed last December that the reason America can’t have nice things
is, well, Americans:

We are in a
slow-motion collapse. While
it is still theoretically possible we can save our society, the odds are low. The
fight is not yet pointless, but it is clear that since 1980, the center has
collapsed. It is difficult to organize dissent, it is difficult to fund a
campaign that will succeed against the big interests that dominate our culture
and economy. If this doesn’t change, soon, everyone will be on their own, doing
what they can for themselves. Who wins if that happens? Corporations, the 1% and the political entrepreneurs.

And our
political entrepreneurs continue to apologize for the American public, making the
case that that Americans both individually and as a group are not complicit in
America’s decline. “It’s not your responsibility” really means “don’t pay
attention, don’t try and change it, get whatever you can.”

Instead, blame
the immigrants, the liberals, the poor, and the undereducated. They are the
reason America is failing, not you. Well, that’s simply Bullshit.  

Those
people standing behind the cash registers, just trying to get by are as much to
blame for the state of our country as those of us who think we know better.

The
Economist had an article
in 2011 about Earnest Dichter, the Austrian immigrant who revolutionized marketing
in the US:  

Most
of the theory behind this practice of helping Americans work against our
interests comes from Dichter. Dichter observed in 1960, in his book “The Strategy of Desire”:

Welcome
to the wild west of capitalism.

From
Ronald Reagan to Karl Rove to Corker in Chattanooga, we have been encouraged to mislead
ourselves, regardless of how smart we think we are.

What’s
Wrong Today:

The Wall Street Journal reported
yesterday that  there is a shortage of airline
pilots. The reason is the rest of the story: (emphasis by the Wrongologist)

The WSJ reports that:

In fact, Republic
Airways Holdings Inc., one of the nation’s largest regional carriers, said it
would have to remove 27 of its 243 aircraft from operation because it couldn’t find enough qualified pilots. While regional
carriers are a key link in the US air-travel system, the big airlines, (whose
pilots’ salaries are much higher), outsource about half of their domestic flights
to these smaller partners in order to save money. The big carriers set the flight
schedules and fares, sell the tickets and buy the fuel, which leaves their
regional counterparts little room to raise wages.

This
structure has prevailed for years, but the WSJ
points out that federal rules implemented in August have brought matters to a
head by increasing the minimum flight experience required for most
commercial-airline pilots to 1,500 hours from 250 hours. The new law has
sharply increased the time and expense required to become a commercial pilot,
rendering today’s starting wages even less attractive and crimping the supply of would-be aviators.

Training
to become a commercial pilot can cost more than $100,000. To get the additional
flying time they now need, pilots can work as instructors or pay for the
additional time. Miami-based Eagle Jet International Inc. charges trainees $57 an hour to be co-pilots on its cargo flights,
which are under a different regulatory regime than passenger operations.

The WSJ
brings us a human interest story as part of their report:

Here is a
thought experiment: Let’s say these guys or gals making minimum wage for a
regional airline make 600 flights a year, (2 flights/day) carrying an average
of 60 passengers each, or 36,000 passengers for the year.

That means
the pilot makes about 42 cents per
passenger flown. Now think about what you pay for the average flight…

Far too
often, skilled worker shortages are blamed on the low quality of our workforce
or our education system. 

There are serious
barriers to receiving a quality education for many in our country, but there probably
is an ample supply of Americans who would like to be airplane pilots. The problem is, if you need to hire a truly
skilled worker, you can’t expect to pay them something close to the minimum
wage. 

Or, if you
do pay them minimum wage, do the rest of us a favor and don’t go around
complaining about how no matter how hard you look, you just can’t find the
workers you need. That’s a fallacy that has served US corporate interests for
decades, enabling US businesses to slash wages, hire immigrants under the H1-B program,
or move jobs offshore.

Most
Americans understand that they can no longer afford to underwrite the cost of a
quality higher education in return for receiving low starting wages. Most Americans
have to take whatever job they can get, knowing that the whole “upward
mobility” thing is over. Most politicians keep pushing the idea that we need to start training Americans for the skilled jobs of today. Um, like airline pilots?

Maybe
the FAA should require each airline to post the salary of the pilot on the cockpit
door for each flight.

Then
customers could decide if they want to fly on a plane piloted by somebody
making the minimum wage.

What’s
Wrong Today:

January’s BLS
employment report shows total nonfarm payroll jobs gained were 113,000 for
January 2014, with private payrolls adding 142,000 jobs. Government jobs
decreased by 29,000. The US Postal Service alone shed 9,000 jobs.

The start
of the Great Recession was in December 2007. We are still down 851,000 jobs from December 2007, more than six years ago.

There are lots of ways to look at the data, but let’s focus today on self-employment.
Self-employment has been hailed as a solution for America’s employment ills. If you’re looking to become self-employed in Britain, taxi driving is a great option but make sure you use one sure insurance for the best deals.
There was the hype of Free
Agent Nation, by Daniel Pink that declared in 1997 that the work
environment was about to get radically different, that freelancers, temps and microbusiness
owners were where America’s employment
growth would occur. The Internet revolution untethered workers and made
independent work very possible, while the mindset of Generation X and the Millennials
leads them to prefer working independently.

So,
has self-employment been growing like a weed? No, it has not.

Justin Fox of the Harvard Business Review wrote
about the BLS data for self-employed workers:

Fox shows
that the number of self-employed is unchanged since January 2000, but the
long-term trend in self-employment is headed down:

Declines
in the unincorporated self-employed are largely due to the decline in farmers. They
were more than 8% of the workforce in the late 1940s. Now they account for less
than 1%. This shows we should support people trying to run their own business in a much better fashion. Many people work as tradesman, but we have to ensure they have everything they need to thrive. In the UK, insurance companies offer all risk insurance to help support these people.

Other
long-established occupations have also declined: Mom & pop stores, and physicians,
who have been grouping together or joining hospital staffs. Real estate agents
and contractors are down due to the bust in housing.

But, we
have been told that self-employment is the future for the new economy, where free
agents, contractors and part-time work from home would explode since corporations
were not hiring and government jobs wouldn’t be coming back.

If so, where
are they in the statistics?

The BLS
gets its self-employment totals from the Current
Population Survey, (also called the household survey), a monthly survey of
60,000 American households conducted by the Census Bureau (this survey also generates
the unemployment rate). Respondents are asked, “Last week were you employed by
government, by a private company, a nonprofit organization, or were you
self-employed?”

This
either/or choice may exclude a lot of people who are working on
the side, or whose jobs are really more like gigs. Self-employed owners of incorporated
business are not counted among the self-employed, nor are workers who freelance
or have secondary sources of income.

A survey
on behalf of MBO Partners, a provider
of support services for independent workers, counts temp workers, on-call
workers, and those on fixed-term contracts as “independent workers.” They say the
total self-employed pool was 17.7 million in 2013, up from 16 million two years
before. Steve King of Emergent
Research, which designed the MBO survey says:

Wait,
there’s more. The Freelancers Union
frequently cites the number 42 million
independent workers, about a third
of our workforce. They get their number from a 2006 GAO report that said
there were about 42.6 million “contingent workers,” meaning:

The bad jobs are probably really
growing, but the BLS definitions haven’t caught up with data, so it’s hard to see them. Which
jobs had the largest increases in self-employment? Fox at the HBR included another graph that shows
which “careers” are having a party:

There hasn’t exactly been a boom in
independent white-collar work. “Managers All Other” is a category of people who can’t otherwise be classified as construction
managers, purchasing managers, financial managers, etc. Also, the definitions of
the occupational categories used by
the government has an impact: All the nation’s maids get thrown into
one category; while physicians are split into nine.

Since
the start of the Great Recession, many white collar workers who may have previously
worked as independent, freelanced, long term contractors are required to be
employees of the contingent workforce agencies that corporations now use.
Moreover, most are exempt from overtime. Few employees hired by these companies
will ever receive 20+ hours per week, unless they have skills in an area that
is in great demand.

There
are looming social costs that may contribute to the self-employment/contractor future: A recent survey by TD
Ameritrade found that even though the majority of self-employed people
think that they’ll live on their savings when they eventually stop working, 70% of them are not actually saving for
retirement on a regular basis:

• 28% of self-employed people
  report that they aren’t saving for retirement at all
• 40% aren’t saving regularly
• 83% have put their retirement
  savings on hold or cut back at one time or another

It gets
worse: For those who own a business, only
19% plan to fund their retirement through profits from the company which will
continue to run after their retirement, and only 14% think they’ll be able to
sell their business and live off the profits from the sale.


Even worse: According to the
TD Ameritrade survey, 29% of Gen X and 32% of Millennial self-employed aren’t currently saving for their
retirements. So, a significant minority of our youngest self-employed
are expecting a miracle to bail them out when they face retirement.

The next
time one of our political elites celebrates the energy and entrepreneurship being
shown by our self-employed, perhaps we should remind them that most of the jobs
being created in this category are service industry workers who earn below or near
median wage, and that many of these “entrepreneurs” are not saving for
retirement.

Oh, and remind
the politicos that the self-employed often find it very difficult or impossible
to qualify for a mortgage
and for health
care insurance.

What’s
Wrong Today:

Have you
ever heard of the Heckman
Equation? Neither had the Wrongologist.

Dr. James Heckman is an
American economist and winner of the Nobel Prize for Economics in 2000. Heckman is a
professor of economics at the University of Chicago. His research shows that poor
families should have guaranteed access to education for their 3- and
4-year-olds.

Heckman says
he isn’t advocating socialism, it’s just the opposite: He is fixing a market
failure.

Unlike
our political elites and some of their captured economists, Heckman stresses using observable data in making public policy. His thesis is that
focused and individualized attention paid to the young children of poor families
can be a hard-nosed investment that pays off in lower social welfare costs,
decreased crime rates, and increased tax revenue.

The Heckman
Equation demonstrates the numbers that prove his point. According to Business
Week, Heckman says:

Heckman’s
equation is based on two long-term studies, one begun in the 1960s in
Ypsilanti, MI, and another a decade later in Chapel Hill, NC. Both provided
free preschool to children from lower-income families. In the decades since,
researchers have followed those children, who are now adults.

• At
  age 40, the subjects from the Ypsilanti study were far more likely than their
  peers to have graduated from high school and have jobs. They were more likely
  to own homes and less likely to have needed social services. The boys were more
  likely to have grown up to raise their own children and less likely ever to
  have been arrested.

• Children
  from the program in Chapel Hill had higher test scores than their peers through
  adolescence and were more likely to have gone to college.

While both
studies are well-known to education researchers, Heckman and several co-authors
produced in 2010 what he called the “first rigorous cost-benefit study” of the
Ypsilanti program. The free instruction cost $17,759 per child per year in 2006
dollars (the year they began working with the data). Heckman set out to find
out what taxpayers got for that money. He calculated what the program had saved
the state and federal government in social welfare, what it had paid in
increased tax revenue from higher wages, and, most significantly, what it had
saved in police, court, and prison costs.

The initial investment provided what
Heckman calls a “return to society” at an annual rate of 7% to 10%. In dollar
terms, each dollar spent at age 4 is worth between $60 and $300 by age 65.

A lot of the return
on investment comes from crime reduction, but Heckman’s research
paper indicates that early learning boosts lifetime earnings:

Heckman
also cites the Perry
preschool program as an example that proves his points: Between 1962 and
1967, the Perry program offered preschool to a group of three- and
four-year-olds born in poverty. Interviewed
at age 40 in the mid-2000s, that group was significantly more likely to have
graduated from high school and to earn more than $20,000 a year.

So, when
Mr. Obama said in the 2014 State of the Union address:

He
was talking about Heckman. Last year, the White House acknowledged Heckman’s research
(along with the Perry preschool work) by including early education grants for
states in its budget proposal. On Dec. 13, congressional negotiators put $250
million for new early education funding into its omnibus spending bill.

According
to Business Week, some states
are way ahead of the Obama Administration. Fifteen governors, both Republicans and Democrats, included new money for early childhood education in their
budgets in 2013. In all, states are now spending $400 million more on pre-K
than before the economic downturn, so Heckman’s ideas are gaining ground.

Heckman’s data
show that the earlier a child gets help, the better the results through each
stage of education. Yet, younger parents are on the whole, more financially constrained
at that point than when their kids are older. So when they ought to be putting
their kids into early education programs, they don’t have the money or credit
to pay for it.

Economists
call this an imperfect market. Business Week quotes Heckman:

So, Dr.
Heckman is building a case for a soft-hearted investment in America’s
pre-schoolers. If you are a certain kind of politician, you will be able to smell
the socialism and redistribution. Sadly for them, Heckman’s work is backed by
data, not just the bias of Randian fundamentalism.

This
should be an idea that everyone in America can support, particularly since the
data show it works.

This weekend, think about the “financialization” of our democracy.
It’s not that difficult to understand. Our democracy has been weakened because our politicians
have surrendered themselves to the global 1%.

Money governs. That’s your inspiration
for today’s homily.

The margins for conducting political
dissent have disappeared. And trying to find middle ground to pass legislation
is nearly impossible. Politics has become just marketing. And most politicians
have become part of the financial system: They are political entrepreneurs selling
just to make a buck.
Willy Loman says in Death of a
Salesman:

Willy Loman discovers
there’s a problem:

America is out there in the blue. It’s time for the earthquake.

The decline in our working environment never ends:

Politicians have trouble with CVS’ decision:

Political and dating advice: Don’t use Huck as your wingman:

Leno hurts job statistics:

Security is tight at the Sochi Olympics:

What’s
Wrong Today:

Yesterday’s Wall Street Journal reported
on how the backbone
of America’s labor force are out of work at unprecedented
levels. From the WSJ:

Having so
many men out of work is partly a symptom of a US economy that is slow to
recover from the worst recession in 75 years. It also shows how technology and
globalization are transforming jobs faster than many workers can possibly adapt.
More from the WSJ:

Although
the economy has improved and the official unemployment rate has fallen to 6.7%,
the numbers for working-age men are terrible: 17% of men 25-54 weren’t working in December. More than
two-thirds said they weren’t looking for work, so the government doesn’t label
them unemployed.

The
January report on the job market is due today.

For women,
the story is different. In the 1950s, only about a third of women ages 25 to 54
had jobs. That rose steadily until the 1990s, and then leveled off. At last tally,
about 70% are working; 30% are not.

The bleak
prospects for the long-term unemployed—40% of men looking for jobs say they
have been out of work six months or more—is alarming: The longer a person is
unemployed, according to a recent study, the harder it is to find a job. The good news is that there is an increase in resources for people to use when they are in this situation, such as the ability to download templates for free to use as resumes, and a rise in jobseeker facilities.

That
research is by Rand Ghayad, a visiting scholar at the Boston Federal Reserve
Bank, and William Dickens, a professor of economics at Northeastern University.
They analyzed Beveridge
curves to see who the recovery is leaving behind. A Beveridge curve shows
the relationship between job openings and unemployment.

What
Ghayad and Dickens found is that the Beveridge curves are normal across all
ages, industries, and education levels, as long as you haven’t been out
of work for more than six months. In other words, it doesn’t matter
whether you’re young or old, blue-collar or white-collar, or a high school or
college grad: The only thing that matters is how long you’ve been out of
work.

Wage
stagnation is an issue as well. Since the early 1970s, the average
inflation-adjusted wage for high-school dropouts has fallen about 25%; for
high-school graduates with no college degree, it is down about 15%.

Simply
put, many of the available jobs don’t pay enough to get men to take them,
particularly if securing a job requires moving, long commutes or surrendering
government benefits. Economists say part of the problem is that men with few
marketable skills and little education can’t find work that pays enough to get
them off the couch.

Here are
some data compiled by the WSJ:

We
reported last
week that a new Wal-Mart opened in DC and advertised that 400 people would
be hired. Over 20,000 people applied for those 400 jobs, making it harder
to get a job at Wal-Mart than to get into Harvard. It doesn’t end
there. ERE
reports:

Sure the
Internet makes it vastly easier to apply for jobs than the old-fashioned
written submission, but, according to ERE, if you are late to finding an open
position on the web, your chances are slim because the first resume is received
within 200 seconds after a position is posted.

If you
post your resume online on a major job site like Monster so that a recruiter
can find it, you are facing stiff competition because 427,000 other
resumes are posted just on Monster each week.

It is clear that at least some unemployed men are on
trajectories that can’t be sustained. They are borrowing money and selling
assets and many are falling behind on payments.

The WSJ article makes it clear that the duration and severity of
unemployment among men in their peak earning years is causing both more
suffering than is readily apparent, and that this group is also likely to wind
up impoverished in their old age.

These men, who have self-identified as producers and
breadwinners, face a grim future in psychological as well as financial terms.

This is not an Obama problem, this is a societal problem, and the Senate’s failure to pass an extension of extended unemployment benefits yesterday doesn’t help. Our society needs to wake up to the
reality that once you’ve been out of work for six months, there’s little you
can do to find work, regardless of how strong the rest of your resume is.

After all, employers
hardly look at it: ERE indicates recruiters spend 6 seconds reviewing each resume that passes through the keyword screens.

The worst possible
outcome for all of us is if many men between 25 and 54 become unemployable. That has
major socio-cultural implications and it permanently reduces our productive
capacity.

This
problem is larger than any administration. Free trade policies pursued by
administrations of both parties have resulted in the loss of decent paying middle
class jobs, while automation and technological advances are also major factors.
It would be inaccurate to try to solely blame our elected officials for continued technological advancement, and the changes to the
structure of the economy that result.

But it is
horrible is that both political parties recognize the problem, but that only
one side seems energized to do anything about it.

What’s
Wrong Today:

The Great
Recession has caused continued hardship for many Americans. Yet a recent HUD report
found that homelessness is down. The report by HUD to Congress says homelessness
decreased by nearly 4% over the past year, and by 13% since 2007. The report
also states:

But the
survey doesn’t actually measure homelessness.

Instead,
it looks at people who are in shelters or transitional housing and the number
of people who are outside on a single January night. Not included are those
doubled up or couch surfing because they can’t afford their own place. Neither
are people in hospitals, mental health or substance abuse centers, jails or
prisons with nowhere to go upon release.

The
problem isn’t just the narrow scope of the count; its methods are flawed. For
the count of people in shelters and transitional housing, service providers
report their numbers on the designated night. But they are just measuring
capacity. If the number goes down, this could mean either fewer homeless or
fewer beds for them.

The
“street” part of the count tries to count people in places “not meant for human
habitation,” such as streets, parks, alleys, subway tunnels, all-night movie
theaters, abandoned buildings, roofs, stairwells, caves, campgrounds and
vehicles.

Although HUD
sets the guidelines, communities have discretion in how they count. A few use
sophisticated statistical methods, but most simply organize volunteers to fan
out and make judgments about who is homeless, sometimes avoiding locations
where they feel unsafe. How even the best prepared volunteers can cover large parts
of town thoroughly in a few hours is anyone’s guess.

Local
policies can also affect the count. For example, cities are increasingly making
it a crime to sleep in public places. If the street count goes down, is it
because need is down or because there is greater cause to fear arrest, driving
people into hiding?

Similarly,
in some cities, families seeking shelter can be threatened with removal of
their children, so families living outside have extra incentive to avoid
detection.

Homelessness
persists. It is not a single night event.

Utah has come
up with an innovative way to solve homelessness. They give away homes. What
worse way could there be to combat homelessness in America than to provide the
homeless with a place to live?

From the Daily
Kos:

 And
who is to blame for trying this experiment? That famous Chinese food lover and compassionate
conservative, former Republican Governor John Huntsman.

According
to Nationswell,
Utah has reduced its rate of chronic homelessness by 74% over the past eight
years, moving 2000 people off the street and putting the state on track to
eradicate homelessness altogether by 2015. It’s such a ridiculous proposition
that only Utah, that bastion of conservative values, could suggest and then
implement it.

Now, with
its growing success, the policy has a chance of spreading to other conservative
locales, like Wyoming.

According
to RealtyTrac,
in 2013, 14.2 million homes were vacant all year for some reason:

The
HUD report says there are 610,000 homeless in America, and we have 14.2 million
vacant homes. Utah shows us that the homelessness problem can be partially
solved with vacant housing stock. What would be wrong with giving it a try?

Earlier
this week, we wrote about Slumlord
Billionaires, Wall Street-backed investment companies that are buying up
vacant houses and renting them out.

Even
Wall Street can’t buy them all, or lease all of them back to their previous
owners. Ending homelessness requires closing the gap between the need for
housing and its availability. It requires enacting policies as Utah has done.

“For I was
hungry and you gave me food, I was thirsty and you gave me drink, I was a
stranger and you welcomed me,”


Who said that?