Wednesday, May 17, 2017

[NJFAC] Full Employment and How to Get It

Full Employment and How to Get It                             By Frank Stricker
The President speaks: "Jobs, jobs, jobs, we're gonna give you so many new jobs you will be sick of it."
Bob Right, Faux-Freedom Caucus member, thinks:  "Great! And he'll make sure that the government doesn't start job programs like the WPA and CCC that we had in the 1930s. And thank god he won't be deincentivizing rich people by taking back the trillions of dollars they grabbed in the last forty years. Just the opposite. More tax cuts for the 1%. That's freedom."                                                                                                                   
            Really, Bob?
            The chart below is a slice of wage and job history covering 65 years. It shows how bad things have often been without good-job programs. Wage growth has been mostly terrible since the 1960s, and job growth has been on-again-off-again since 1980. After the 1960s, we had just one period when both wage and job growth were strong. You might conclude, as I do, that deliberate policies had something to do with this bad record.
 
Report Card on Growth in Real Wages and Total Jobs, Five-Year Periods, 1950-2015[1]                                                                                    
                                  Wages          Jobs                 
1950-1955
A+
A
1955-1960
A
B
1960-1965
B+
A
1965-1970
C
A+
1970-1975
F
B+
1975-1980
FF
A+
1980-1985
FF
D
1985-1990
FF
A
1990-1995
FF
D
1995-2000
C-
A
2000-2005
F
F
2005-2010
F
FF
2010-2015
D
B
 
 
 
 
 
 
Total five-year growth in wages and jobs graded thusly: 10% or more = A, 8%-9% = B, 7% = C, 6% = D, under 6% = F, decline =FF.
 
 
 
The Great Recession was a catastrophe for millions of people in the United States and many other countries, but it did add force to movements organizing for income equality and higher wages. Occupy Wall Street put economic inequality on the front page. Fast-food workers, many with union support, organized and demonstrated. Some states and cities raised their minimum wages, sometimes to levels that had once seemed unattainable. But there's been no increase in the federal minimum wage and no new permanent job programs, unless you consider Obamacare a job program. The Democrats  missed an opportunity to fix lousy job markets. Too little courage, too much faith in business markets.
During the recession everyone talked about unemployment, but as the economy improved and the official unemployment rate fell, less was said about the need for job creation. Mr. Trump talks about saving jobs in the mines and factories and adding millions of infrastructure jobs, but he presents no realistic plans for any of this. He argues that big tax cuts--handouts to rich people and big businesses--will create a lot of jobs. Did the Bush cuts of 2001 and 2003 deliver more jobs? Check the chart.
We are not close to full employment, despite what the experts say. The real unemployment rate is more than twice the official rate. And we have not had sustained wage increases for a long time. Real hourly pay for the average employee is about where it was in 1973. The deck is stacked against employees in many ways and one way is that there are 20 million people who want a job or want to move from part-time to full-time work. So there's a labor surplus that saps employee bargaining power.
If the American people really want more and better jobs--and not just political theatre-- they need to push Congress to double the minimum wage right away and get behind government programs that directly create good jobs. One general job program has been introduced into the House by Representative John Conyers and it is also a project of the National Jobs for All Coalition. It's  HR 1000, The Humphrey-Hawkins 21st Century Full Employment and Training Act, which establishes a trust fund to create 6 million new jobs. [2] Progressives should also push to create a Department of Public Infrastructure. America's infrastructure got another D+ this year from the engineers.
We can have high-wage full employment. Here's what it might look like in ten years if we start fixing things now.
What Real Full Employment Could Look Like in 2027
1. The federal government guarantees a job for everyone who wants and needs one. That is a way to be sure that we have full employment. At real full employment, the official unemployment rate stays at or below 2%.
2. Securing a new job takes only a month or two--half as long as in 2016. There are real labor shortages and employers routinely raise wages to attract workers.
3. The economy adds 300,000 jobs per month instead of 200,000, as in 2016.  That's a million more per year and 10 million more in ten years. Sound impossible? There's a lot of give in the size of the labor force. In January of 2017, there were 7.6 million officially unemployed, 5.8 million part-timers wanting full-time work, and 5.7 million job-wanters who had not recently searched for a job.
4. The federal minimum wage has been lifted every year until it is $20 an hour. Because of fuller employment and high demand for workers, most employers have to pay more. The average working-class wage, which was $22 in 2017, is $35. Even after inflation, the purchasing power of that wage is up 30%.
5. The national unemployment rate of 2% holds true across the land. Thanks in part to the National Full Employment Trust Fund, which is funded by a tiny tax on stock and bond transactions, more jobs go to high-unemployment areas. Extreme jobless rates for African-Americans in Chicago and poor whites in West Virginia are becoming a thing of the past.
6. Full-employment America includes a dense network of social services to facilitate work, including universal, affordable child care and federal training programs linked to real jobs. Affirmative action is enforced and minorities, poor people, and residents of hollowed-out communities are getting decent jobs. Federal policy and government-supported citizen-groups help ex-prisoners find work. Employers are required to accommodate people with disabilities, and because there are labor shortages, they are more willing to comply.
7. The history of recent decades shows that the private sector thrives on low wages and a labor surplus. That is why real full employment requires federal programs to directly create jobs. So the federal presence has spread. There are thousands of new public- and private- sector projects funded and supervised by the federal government. They range from new parks and better bridges to more and better Head Start schools and more green energy businesses. Some projects are overseen by existing government departments. Many are funded and supervised by the Department of Labor under the National Full Employment Trust Fund or managed by the Department of Public Infrastructure.
8. Employee involvement and opportunities for advancement are increasing. As compensation improves, there is more discussion about reducing the standard forty-hour week.[3]      
            Does all this sound utopian?  It may, but is there anything more utopian than believing that deregulation and more tax cuts to the rich will bring full employment and better wages? 
How has that worked out in the last few decades? Check the chart.       
    Frank Stricker is emeritus professor of history and interdisciplinary studies at California State University, Dominguez Hills. He is on the board of NJFAC, and author of the How America Lost the War on Poverty (2007).                         
 


 
[1]. Data for job totals in the chart come from Current Employment Statistics (CES), at BLS.gov, measured January to January. Thus for 2010-2015, totals are from January, 2010 to January 2015. Real wages are from the annual Economic Reports of the President, including the one for 2016, Table B-15, p. 418, and BLS Economic News Releases, Table A-2, Current and real (constant 1982-1984 dollars) earnings for production and nonsupervisory employees on private nonfarm payrolls, seasonally adjusted.
2. The National Full Employment Trust Fund is the financial arm of HR 1000. The bill is co-sponsored by several dozen representatives. It is also known as The Jobs for All Act.
 
3. Thanks for suggestions about the meaning of full employment to many people including James Devine, Helen Ginsburg, William Darity, Jr., Darrick Hamilton, Philip Harvey, Trudy Goldberg, June Zaccone, and Scott Myers-Lipton. Harvey's Securing the Right to Employment: Social Welfare Policy and the Unemployed in the United States (Princeton: Princeton University Press, 1989), helped a lot as did Russell A. Nixon, "The Historical Development of the Conception and Implementation of Full Employment as Economic Policy," in Alan Gartner, Russell A. Nixon, and Frank Riessman, eds., Public Service Employment: An Analysis of Its History, Problems and Prospects (New York: Praeger Publishers, 1973), 9-27.
 
 
 

 

 

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Tuesday, May 2, 2017

[NJFAC] Will a Robot Take Your Job?

My paper, Will a Robot Take Your Job?,  is up:

ABSTRACT:  Advances in workplace technology are announced almost daily. What effect are they having on job availability, and which jobs? Some analysts see a jobless world, a world without work. What are the policies being proposed by those for a future like this? This presentation will provide some very tentative answers.


http://njfac.org/wp-content/uploads/2017/04/RobotsJobsS.pdf   for slides. The Slide 3 video is about 10 mins. long, but you can get the general idea in a few minutes.

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June Zaccone
National Jobs for All Coalition
http://www.njfac.org

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Thursday, April 20, 2017

[NJFAC] Living New Deal Map

The National Jobs for All Coalition, along with several other organizations, will be celebrating the publication of a pocket map of New Deal sites and artworks in New York City. [A map for the whole country is at https://livingnewdeal.org/map/.

Two of those events will be at Roosevelt House, May 11th, and the Museum of the City of New York, May 18th. You may register for them at https://livingnewdeal.org/events/celebrate-new-map-new-deal-new-york/   [On that site, click RSVP here for each event.]

There will also be an all-day conference June 8th: When Government Was the Solution: The New Deal's Forgotten Legacy, Then & Now



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June Zaccone
National Jobs for All Coalition
http://www.njfac.org

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Tuesday, April 18, 2017

[NJFAC] "Supply Side Economics, but for Liberals"

 
 
             Are government assistance programs disincentives to work?  Clearly, some are and were designed to be that way. Social Security is a prime example. Here Neil Irwin argues that research now shows that food stamps, the Earned Income Tax Credit, and child-care subsidies are linked to more work rather than less.
            Other programs may have negative effects on the will to work. Disability benefits are supposed to keep people who are truly sick and disabled from having to work and that is a plus. But do they keep out of work people who should be working? That is a subject for another day, but it's pretty clear that when job markets are lousy and pay is low, as they have been for a long time for millions of workers, more people will apply for benefits, whether or not they are so disabled as to be unable to work. 
            Irwin does not delve into another issue: Do unemployment benefits keep many people out of the labor force for a longer time than if they had no benefits? Some research shows that the difference is very small. And is that a bad thing for the unemployed? If they find a job closer to what they want, they and their employers will be better off in the long run.  
            Finally, there is a larger point in this whole discussion: should our goal be to have as many people as possible working all the time? Aside from the social and moral issues the question raises, I think there is a growing army of smart robots who may provide an answer of their own.
 
Frank Stricker, NJFAC, and author of Why America Lost the War on Poverty.
 

 

 

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Tuesday, April 4, 2017

[NJFAC] State incentives to corporations to create jobs "don't really work"

Corporate Incentives Cost U.S. $45 Billion in 2015, Don't Really Work


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June Zaccone
National Jobs for All Coalition
http://www.njfac.org

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Thursday, March 16, 2017

[NJFAC] "In A Good Society, What Should the Minimum Wage Be?" by Frank Stricker

            How can we decide what a minimally decent wage is? It is easy to see that $7.25, the federal minimum wage, is not decent. Even $10 an hour yields only $20,800 for year-round, full-time work. That's below the extra-low American poverty line for a family of four. Even for an individual living alone, it would not be enough in most cities around the United States. The $15 goal that many activists are working on and that California will reach in 2022, is much, much better. By an estimate made two years ago, 42% of American workers were earning less than $15 an hour, so movements that win a $15 minimum in states and cities are beginning to help millions and millions of workers. 
            But $15 is the least we should be aiming for over the long-range. It yields just a little more than $30,000 for a full-year of full-time work. And many low-wage workers do not work full-time.[1]
If we are debating with people who think $15 is terribly high, can we defend something higher $15? What would be an ideal minimum for our time. There are several ways to construct an ideal minimum wage, but two methods are particularly relevant. One is about minimum living standards and the other is about equality. As to the first, we can ask how much a family needs to live, not in affluence, but in modest comfort. Experts have estimated that a two-parent, two-child family requires about $54,500 a year for a modest living standard. (The amounts vary by where the family lives.) If there is only one earner, he or she must work full-time and earn $26 an hour.[2]
If we apply the equality method, we can say that people deserve to share in general increases in national income. One way to proceed here is to focus on per capita income--the total national income divided by the population. Per capita income increased 16 times between 1965 and 2015, but average hourly pay increased only half as much. One reason is that a tiny group of Acapitas@--the rich--seized much of the increase in the national income. If the hourly wage of the average rank-and-file worker had increased as much as per capita income, it would be $40 today, not $21. If the federal minimum wage of 1965 had increased by a factor of 16, it would be $20 an hour, not $7.25.[3]
In light of these facts, it is astonishing that many national politicians are happy with the pathetically low national minimum wage of $7.25. This indifference to the working poor occurs while big bankers and business tycoons take home massive compensation packages of millions and even billions of dollars.
I wonder what the President's working-class supporters expect of him on the wage front? He likes to visit factories and talk about jobs, but it tells us something about what he really thinks of the working class that the President, his appointees, and his friends are fine with a $7.25 national minimum wage and do not support the $15 movement.               
 
Frank Stricker is emeritus professor of history and labor studies at California State University, Dominguez Hills, and he is a member of the National Jobs for All Coalition. He's finishing a book about the history and future of American unemployment.
 


[1]. 52 weeks of 40 hours = 2,080. Actual average weekly hours are usually just below 35. A review of much literature on the subject is Arne L. Kalleberg, Good Jobs, Bad Jobs: The Rise of Polarized and Precarious Employment Systems in the United States, 1970s to 2000s (NY: Russell Sage Foundation, 2011). Also Irene Tung, Yannet Lathrop, and Paul Sonn, "The Growing Movement for $15," National Employment Law Project, November, 2015.
[2]. James Lin and Jared Bernstein, AWhat We Need to Get By,@ EPI Briefing Paper #224, October. 29, 2008, www.epi.org. The budgets ranged from a high in New York City ($68,758) to a low in rural Mississippi ($35,733). The national average was $48,778, which, after inflation, is about $54,500 in 2017. See also Andrew Khouri, ALow-Wage Workers Can=t Afford Rent,@ Los Angeles Times, March 25, 2014, B2.
[3]. Annie Lowrey, ARaising the Minimum Wage Would Ease Income Gap but Carries Political Risks,@ New York Times, February 13, 2013, accessed at nytimes.com, 2/13/2013; Steve Lopez, AOverlooked and Underpaid,@ LAT, 5/22, 13, A2; Lydia Saad, AAmericans Say Family of Four Needs Nearly $60K to >Get By,=@ accessed at gallup.ocm/poll162587 on 5/22/2013; Don Lee and Shan Li, ARaising the Wage Floor,@ LAT, February 14, 2013, B1, B4. Per capita income is from the Bureau of Economic Analysis at united-states.reaproject.org/analysis/comparative-trends.
 
 

 

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Tuesday, February 14, 2017

[NJFAC] Thinking about an Infrastructure Program

Thinking about an Infrastructure Program: Part I       By Frank Stricker
             Here is a link to a useful, short piece on what might be coming down the pike this spring: Trump's infrastructure plan has huge risks It was written by AP reporters Joan Lowy and David A. Lieb and I read it in Business Insider. The article discussed several issues we should be thinking about, but did not include others that should be addressed if we want a good program. Here's a partial list from Lowy and Lieb and others, including your author. You can also look at Robert Reich's five-minute video, at Robert Reich: Trump's infrastructure scam - YouTube
1. Why bother? Do we need a big new program? Most of us say yes; so do the experts. The engineers give America's infrastructure a D+.
2. Privatize? Should structures or at least their revenues be privatized? Two of Mr. Trump's advisors, economist Peter Navarro and billionaire, now Secretary of Commerce, Wilbur Ross, published a campaign paper on October 27, 2016, called "Trump versus Clinton on Infrastructure." It goes without saying that there was nothing about taxing the rich and corporations more to help finance a major push on infrastructure. Just the opposite. It was about cutting regulations, offering huge tax credits to builders and investors, and paying off investors and builders from revenues and fees generated by public structures. During the campaign Mr. Trump promised a trillion-dollar program. Can $123 billion in tax credits generate $1 trillion of repairs and new construction?  If private firms are in control and dependent on fees and tools to support their expenditures, will we end up having to buy a ticket to get into our new neighborhood park? (More likely neighborhood parks and things like that will not be built.) Will local water rates soar after the pipes are fixed? And what kind of revenue stream can be generated from filling pot holes? Much of what is hinted in the Navarro-Ross paper is vague and much is utopian about the wonders of private control and cutting government regulations.
3.Taxation? If not enough can be done with tax credits, will the President and his aides work hard to raise money to do what is needed?  The president and especially Congressional Republicans are all about tax cuts of almost every kind. But if they won't agree to tax the rich and large businesses to repair the infrastructure, will they at least agree to raise the gas tax, which has not been increased in two decades? The increase could ramp up road repair projects and some of the funds could give a boost to mass transit as well. And will Trump be able to get Tea Party types to allow larger budget deficits to finance infrastructure improvements? In general, can we expect that Wall Street investors, rich conservative donors, and Republicans in Congress will support a program that is as clean and large as the country needs? In the old days Republicans liked public improvements that came to their own districts, but is that generalization true of the privatizers in today's party?
4. Equal Access to Jobs? Nothing in the Navarro-Ross publication nor anything else we've heard from the Trump camp has addressed the question of whether equal access to jobs and benefits will be guaranteed to minorities, poor people, women, the disabled, and others who often face hiring discrimination. Will the administration only practice affirmative action for non-college-educated white people in Michigan, Ohio, Pennsylvania, Wisconsin, and West Virginia? The Navarro-Ross paper promises to expedite construction programs--less red tape and fewer regulations. A streamlined application process--it's hard to disagree with that general idea. But what if streamlining is mainly about cutting equality provisions and environmental regulations? If you really want to eliminate the EPA and clean air regulations, as many Republicans do, that means people who live and work in and near workplaces and building projects that generate a lot of dirt and dangerous poisons are out of luck. 
5. Wages. Will there be wage guarantees for people working in the program? Mr. Trump does not support a $15 federal minimum, nor does the man he wants as Labor Secretary. That's not a good sign. Even $15 an hour for a full-time year-round job is just a bit over $30,000 and that's not much for any kind of household, even one with a single member, especially in a big city.
6. Hard Goods Only? Should infrastructure be thought of, mainly, as a question of hard goods--bridges and roads and buildings and so on? Or should we expand the concept so that, for example, we could consider an upgrade for the care industry as part of an infrastructure program? Or should such programs be discussed and fixed separately?
7. Doesn't government always screw things up?  Coming soon. In a later article, I will touch on the WPA, CCC, PWA, and CWA--job programs of the 1930s--and Obama's stimulus package of 2009. Also the difficulties that accompanied the introduction of George Bush's Medicare D program and Obama's Affordable Care Act. And the catastrophes that followed when Wall Street was given a free hand to manage a big chunk of the economy in the late 1920s and early 2000s.
Frank Stricker is emeritus professor of history and labor studies at California State University, Dominguez Hills, and he is a member of the National Jobs for All Coalition. He's finishing a book about the history and future of American unemployment. 

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