Rolling US Economy Into The Shitbin Thread

how does this apply to amazon mechanical turk!

Right, but that makes it sound like if you stopped subsidizing, the business model wouldn't work. Which is why the argument makes me a little uncomfortable. I support raising the minimum wage.

It does seem plausible that without government benefits Walmart would be forced to pay slightly higher wages. Same probably goes for other big companies that rely on minimum wage labor (such as the fast food industry). But it's hard to say because reducing government benefits would have lots of indirect effects on demand and such. In any case, the way I see it, that's not an argument for reducing benefits, but rather for raising the minimum wage.

My life as a retail worker, written by a former political journalist.

After recently having one of those bougie "honey I don't know if we're saving enough for retirement" conversations, this was sobering to read:
http://money.cnn.com/2013/06/24/pf/emergency-savings/

Savings account?

"Six months of living expenses" is a good lol to all "middle-class" New Yorkers.

Financial advisors have a vested interest in convincing as many people as possible that "good financial management" requires meeting a variety of difficult to meet goals through strategies that are more complicated than people would construct on their own. Basically, the hordes of financial 'advisors' out there are peddling watered down, simple-minded versions of how the wealthy manage much larger trusts and estates. In order to make enough work for the ever-increasing numbers of these parasites, these strategies are being pushed at people ever further down the income scale. It is an industry and they sell fear, uncertainty and doubt. Don't buy it.

I think the six months' savings things makes a lot of sense if you have a family. Maybe less so if you're single and can easily move to a cheaper rental or crash on a friend's couch or whatever. I agree that a lot of other stuff financial planner types tell you is just ludicrous and beyond imagination, like the amount you're supposed to save for your kids college, the amount you're supposed to save for retirement, etc.

Just having a savings account with as much money as you can wangle into it doesn't require a financial advisor to figure out. Stating flatly that it should contain "six months of living expenses" is more confusing than enlightening.

Very few people can tell you what "one month of living expenses" amounts to. I happen to keep detailed records of what we spend each month, going back to 2008, and the amounts vary so widely I'd have to massage the numbers quite a bit to come up with a number that even vaguely fits "six months of living expenses". As advice, this sounds simple, but as soon as you seriously try to put it to use, it becomes very, very nebulous and more likely to inspire fretting than guide action.

By way of contrast, saying "six months of your rent or mortgage payments" would at least allow a person to quickly and easily calculate a number so they can see what the goal is.

I inherited "a little money" from my mom two years ago, i.e. six months of my rent, pretty much. And rather than keep that as my emergency fund, I'm going to Europe this year.

I hear there's an old saying, "see Naples and die". Have a good time.

xp IDK, it seems kind of intuitive to me that "six months of living expenses" means six months of the things you couldn't or wouldn't want to cut even in an emergency -- food, rent/mortgage, basic utilities, etc.

student loans - the new burden of failure

student loans - the price of growing up in america without family money

student loans = graduate groans!

student loan (interest) = yacht owner gas money!

http://www.fastcompany.com/3027355/pixel-and-dimed-on-not-getting-by-in-the-gig-economy

hahaha as soon as I got to the part with the Thomas Friedman quote I was like "say no more, I would like to sign up for your newsletter"

most terrifying part is buried way in

I'm essentially competing for every hour of my employment.

buried but kind of implied at other points I think. Chilling piece, yeah. Also dovetails nicely with an interview I listened to last night with Jennifer Silva
http://scholar.harvard.edu/jsilva

available here:

http://www.leftbusinessobserver.com/Radio.html#S131121 (Nov 21)

more about the non-tech-savvy In This Economy but some of the themes overlap

the silver lining is that it starts to sound toward the end like these platforms are shitty business models that will either change or fail

3. Half of Americans are "Poor" or "Low-Income"

This is based on the Census Department's Relative Poverty Measure (Table 4), which is "most commonly used in developed countries to measure poverty." The Economic Policy Institute uses the term "economically vulnerable." With this standard, 18 percent of Americans are below the poverty threshold and 32 percent are below twice the threshold, putting them in the low-income category.

The official poverty rate increased by 25 percent between 2000 and 2011. Seniors and children feel the greatest impact, with 55 percent of the elderly and almost 60 percent of children classified as poor or low-income under the relative poverty measure. Wider Opportunities for Women reports that "60 percent of women age 65 and older who live alone or live with a spouse have incomes insufficient to cover basic, daily expenses."

4. It's Much Worse for Black Families

Incredibly, while America's total wealth has risen from $12 trillion to $77 trillion in 25 years, the median net worth for black households has GONE DOWN over approximately the same time, from $7,150 to $6,446, adjusted for inflation. State of Working America reports that almost half of black children under the age of six are living in poverty.

http://www.nationofchange.org/more-evidence-half-america-or-near-poverty-1395672039

^^ worst part is how unsurprising it is.

time to live in 5th element cubies

http://www.esquire.com/blogs/politics/timothy-geithner-book-052914

charles pierce otm

http://www.nytimes.com/interactive/2014/06/05/upshot/how-the-recession-reshaped-the-economy-in-255-charts.html?hp

nail salons and dog groomers booming

captain obvious: "a very ugly blame game going on that’s directed — is orchestrated — by people who are doing very nicely at the top to turn the sort of great middle class that itself is feeling squeezed against people at the bottom"

http://www.salon.com/2014/06/30/a_very_ugly_blame_game_how_great_recession_is_affecting_people_in_totally_unexpected_ways/

Bubble Paranoia Setting in as S&P 500 Surge Stirs Angst

I don't want most people to experience the misery of another bubble bursting but I feel like the post-recession gains in the economy have been accumulated by such a relatively small number of people that it wouldn't be as devastating.

I could easily see stocks falling 10% on no news, but to get more than that, I think something would have to happen in the "real" economy.

on the bright side, enough americans now live in poverty that something/anything must be done (besides cut taxes / deregulate big finance)?

http://theweek.com/article/index/268053/the-american-middle-class-is-no-longer-safe-from-poverty-mdash-and-that-might-be-a-good-thing

U.S. Economy Grew 5% in Third Quarter, Its Fastest Rate in More Than a Decade

http://www.nytimes.com/2014/12/24/business/us-q3-gdp-revised-up-to-5-percent.html

"As anthropologist David Graeber puts it, 'Whenever someone starts talking about the ‘free market,’ it’s a good idea to look around for the man with the gun.' Despite the endless talk of a 'free market,' our economy is shaped by myriad government policies—and no matter where we look, we see government policies working against everyday workers. Whether it’s letting the real value of the minimum wage decline, making it harder to unionize, or creating bankruptcy laws and intellectual-property regimes that primarily benefit capital and the 1 percent, the way the government structures markets is responsible for weakening labor and causing wages to stay stuck."

http://www.thenation.com/article/200257/score-wages-liberal-nihilism

i agree with konczal but i also feel like wages are gonna start increasing soon. not that that necessarily contradicts anything he's saying here. but the best thing to raise wages is a low unemployment rate. if unemployment were to continue declining and wages not go up, something is definitely up

unionization is weird because the types of industries that are/were unionized tended to pay relatively higher wages so it's hard to figure out what the _actual_ union premium is. it's not empirically clear anymore that there even is a significant premium. people were talking about this paper (https://economics.byu.edu/frandsen/Documents/unioneffects.pdf) a few weeks ago that found a negative premium (for those who don't trust or can't understand economists this is a good explanation of the result & problems with the research design from a credibly left-wing source http://inthesetimes.com/working/entry/17663/a_recent_study_says_unionized_companies_actually_pay_less._the_truth_is_a_b) (and here's matt yglesias http://www.vox.com/2015/2/3/7966951/frandsen-union-wages)

fancy high skill jobs that already pay a high premium don't really need unions and the industries that employ them benefit from the flexibility, but widespread unionization of service sector could be welfare improving

obama wants to raise the federal minimum wage to 10$. that's obviously not going to happen anytime soon, but citywide MWs seem to be catching on and don't seem to have much effect on employment (although they do increase prices) (http://www.irle.berkeley.edu/cwed/wp/economicimpacts_07.pdf) a lot depends on what happens in oakland & seattle, if the elasticity is still small around 15$ MW workers in other cities are gonna start making noise

i tend to think there's a limit to how much influence govts have on labor market outcomes for good or bad and that rather than try to chase the dream of higher wages we should just go straight for the jugular and redistribute. USA and sweden have the same pre-tax GINI coefficient etc

if unemployment were to continue declining and wages not go up, something is definitely up

this is exactly what's happening in the UK fwiw

real wages are actually _falling_ in the uk. labor productivity is also stalling though:

http://www.economicshelp.org/wp-content/uploads/2012/10/boe-labour-prod-2005-12.jpg

in the us it's more of a "mystery" since it's been increasing

http://www.voxeu.org/sites/default/files/image/FromApr2012/saleheen%20fig1%2016%20aug.png

http://finance.yahoo.com/news/something-weird-going-us-economy-133929266.html

Is the US economy tanking right now?

always a healthy question

I'm confused about all these numbers. Dollar getting stronger, Euro getting weaker - so that's ... bad? Good? And US unemployment falling, but real, invisible unemployment ... rising? Steady? Also, Russia - still collapsing? How's China? I assume we're all in the shitbin (save Germany?), but how shitty, for real?

Krugman doesn't seem too worried

Krugman probably envisions the European Central Bank pulling a Bernanke out of its hat, which it may not be able to encompass. As Keynes pointed out, the selfishness that drives expansion in a capitalistic economy is also what drives recessions. It all hinges on whether the broad sum of selfish actions are motivated by optimism or fear. That still applies. As for confusion, there is plenty of room for it atm.

http://www.nytimes.com/2015/04/01/opinion/thomas-edsall-has-american-business-lost-its-mojo.html?emc=edit_ty_20150401&nl=opinion&nlid=34427133&_r=0

I dunno. That article has a graph with actual facts in it regarding the number of businesses closing vs. new businesses opening, but it also has statements like this:

"The forces driving this trend include the increasing regulation of small businesses, corporate consolidation, more occupational licensing requirements and too few immigrants with high-tech skills."

For which statement it gives absolutely no evidence, including such weak-assed stuff as anecdotal evidence, which any half-assed journalist could gin up, whether or not the statement is actually true. I guess we are supposed to find it self-evident.

these are unrelated, more or less, but i've been thinking about these two series of tweets a lot

matt stoller, from a few months ago, on the global dominance of banks and its history:

https://storify.com/keiteay/matthew-stollar

"billmon" on the paucity of good antipoverty policy and the need for direct, WPA-style job programs

https://twitter.com/billmon1/status/595278407304286208

https://twitter.com/billmon1/status/595286441283833856

^ this is kind of what my research is about

i'm not sure how wpa-style jobs programs are fundamentally different from the obama jobs bills, which krugman supported very vocally

problem with "employ everyone in huge public works programs" is it only works every once in a while. once we have the "equilibrium" amount of parks & schools you're either talking about expanding the state or the keynesian joke about "digging holes to fill them back up." so his argument implicitly requires that there's a large amount of non-NAIRU accelerating work out there to be done. which there might be? def lots of infrastructure spending to do on the cheap that is (infuriatingly) not getting done. but again, all the mainstream neoliberals he's deriding support that.

it's kind of like the flip of alesina, the economist who claims reducing government spending would lead to a surge in output as private investment rushes in to replace public spending. it's like, ok, even if we accept that this works (which no one really does) it's only a trick you can pull off once

Well, if you're strapped for ideas of public works that don't require specialized skills, out here in the western USA we have forests full of trails that need maintaining, but which are neglected for lack of money. That work right there could easily absorb a couple hundred thousand laborers in about ten western states for several years. Then there's decommissioning thousands of miles of unused, unneeded logging roads.

i suppose the grimmer future-robot-overlord argument is that we will have (or have already had, for a long time!) whole populations of people who are totally beneath the use of capital, and the state's job is to keep them busy, keep them from turning into, well, what? communists? jihadis? charming hobos?

it's the inherent flaw in capitalism. without consumers, the whole house of cards collapses. but capital monopolizes capital, destroying jobs, undermining consumerism. you can always blame it on benghazi

http://ecx.images-amazon.com/images/I/51XAlxd1AjL._SY344_BO1,204,203,200_.jpg

reading the post-recession postscript added to this in its new edition, it runs from the 80s up to almost today and just plain lays out, here this happened, here congress did that, here this dude stole that, here X percent of all these transactions in the US went through them, etc. etc., facts facts facts and cold and furious as hell

talk about total powerlessness : (

in a perhaps counterproductive gesture i have added that book to my amazon wishlist