Saturday, May 31, 2014

[NJFAC] Housing market: high-end up; rest down

2014 Luxury Report: Sales of Priciest 1% of Homes Climb While Rest of Home Sales Still Down

by Troy Martin | May 27, 2014

Neighborhoods in Los Angeles, Orange County and San Francisco Dominate the Top 20 List of Most Expensive Homes

Home sales so far this year are lower than they were in 2013, but there's one sliver of the housing market that's going strong: the very top of it. Sales of the priciest 1 percent of homes are up 21.1 percent so far this year, following a gain of 35.7 percent in 2013. Meanwhile, in the other 99 percent of the market, home sales have fallen 7.6 percent in 2014.

Growth in the Number of Homes Sold in the top 1%

.....

Thanks to Jared Bernstein's blog: Inequality and the Housing Market

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National Jobs for All Coalition
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Thursday, May 29, 2014

[NJFAC] US middle class "destroyed by design"; remedies

The American Middle Class Was Destroyed by Design: How to Make It Strong Again Harold Myerson, Am. Prospect, 5/14

Once upon a time in a faraway land—the United States following World War II—workers reaped what they sowed. From 1947 through 1973, their income rose in lockstep with increases in productivity. Their median compensation (wages plus benefits) increased by 95 percent as their productivity increased by 97 percent. Then, abruptly, the rewards for greater productivity started going elsewhere—to shareholders, financiers, and top corporate executives. Today, for the vast majority of American workers, the link between their productivity and their compensation no longer exists.

As economists Robert Gordon and Ian Dew-Becker have established, the gains in workers' productivity for the past three decades have gone entirely to the wealthiest 10 percent. The portion of the nation's economy that went to workers' pay and benefits—which had held remarkably steady from 1947 through 1973 at 66 percent or 67 percent—last year fell to a record low of 58 percent, while profits reached a postwar high. Today, the drive to restore workers' share has been narrowed down to the campaign to raise the minimum wage. ...

What corporate apologists won't acknowledge is that workers' incomes have been reduced by design. American business has adamantly opposed workers' efforts to organize unions. Millions of jobs have been outsourced, offshored, franchised out, reclassified as temporary or part-time, or had their wages slashed, in a successful, decades-long campaign to increase the return to capital. Indeed, the only way to explain the soaring profit margins and stock values of recent years despite anemic increases in corporate revenues is that profits have come at the expense of labor.....

....Traditionally, American workers were able to raise their wages by collective bargaining or through the clout they could wield in a full-employment economy. But the ability of private-sector workers to bargain collectively has been destroyed by the evisceration of unions, which now represent just 6.7 percent of private-sector workers.....Re-creating the other avenue for bolstering workers' leverage—a full-employment economy—looks just as remote. Historically, workers won some of their biggest wage gains when the unemployment rate dipped beneath 4 percent, as it did during World War II, the late 1960s, and the 1990s dot-com boom. But low consumer demand (itself largely the result of the diminished spending power of underpaid workers) and the continuing rise of machines that can do people's jobs have combined to diminish the workforce.

....

In a nation where workers have lost the power they once had to raise their incomes, what can be done to make those incomes rise?

Here are eight proposals, beginning with some that have already been enacted in regions where labor-liberal coalitions hold sway, moving on to some that require legislative changes that are not possible today but could be tomorrow, and concluding with those that involve a fundamental reorganization of our economic system. Rebuilding America's middle-class majority will likely require them all.....

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National Jobs for All Coalition
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Thursday, May 22, 2014

[NJFAC] SS taxes exceed lifetime benefits for all but lower-income couples; based on 2012 SS Trustees Report:

Expected Lifetime Social Security and Medicare Benefits, 2012 dollars

Social Security benefits at age 65

Tables included for the following cohorts:

Results for year 2010:

Single man, average wage: SS taxes exceed SS benefits

Single woman, average wage: SS taxes about equal SS benefits

One-earner couple, average wage: benefits exceed taxes

Two-earner couple, average/low wage: benefits exceed taxes

Two-earner couple, average wages: taxes exceed benefits

Two-earner couple, high/average wages: taxes exceed benefits

For all these categories, medicare benefits significantly exceed medicare taxes

See tables: http://www.urban.org/UploadedPDF/412660-Social-Security-and-Medicare-Taxes-and-Benefits-Over-a-Lifetime.pdf

Thanks to Dean Baker's blog.

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

Tuesday, May 13, 2014

[NJFAC] the right to a job

The Nation / By Raúl Carrillo

Your Government Owes You a Job

The stunning barbarism of involuntary unemployment in the U.S.

Involuntary unemployment is barbaric. In the wealthiest country in history, almost 30 million people wish they had full-time work. But, as always, there aren't enough jobs. And because economic security requires decent work, it's unsurprising that 50 million people are poverty-stricken and 16 million child ren are hungry.

This is a disgrace and an economic error: The US government can easily afford a Job Guarantee (JG) program, becoming our employer of last resort.

A right to a job may sound outlandish, but it's common sense. You need dollars to eat, and unless you steal the dollars, you generally have to earn them. If the government wants to protect property with cops, courts, and prisons, issue a single, common currency, and tax and fine us in it, it should at least guarantee we can work for our own dollars. Politicians ramble about equality of opportunity and the dignity of work, but to pull ourselves up by our bootstraps, we need boots. And lest our boots stomp each other's necks in senseless competition for too few jobs, we need a Job Guarantee.

A Job Guarantee isn't that radical. Thomas Paine proposed one in 1791. In 1944, FDR included the right to a living wage job in his Second Bill of Rights and his Republican opponent promised state-ensured employment. The Universal Declaration of Human Rights enshrined the right to work and philosophers Rawls and Dewey advocated government provide enough work. LBJ deliberated a JG and Martin Luther King, Jr., demanded one.

In 1977, the Senate proposed legislation guaranteeing employment, allowing residents to sue the US government should it fail to provide it. The litigation provision was cut, but the final Humphrey-Hawkins Act authorizes Uncle Sam to "create a reservoir of public employment." According to legal scholar Cass Sunstein, in 1990, an overwhelming 86 percent of respondents expressing an opinion wanted that reservoir. This January, the JG still polled high at 47 percent—even higher among people of color—despite its relative unfamiliarity.

....

It may sound expensive, but a JG would pay for itself. "Deficit Owls" argue we can afford much more federal spending of this type. Remember, current anti-poverty programs like unemployment insurance pay people not to work, destroying human capital, sales, output, and the tax base. Estimated spending for a national infrastructure JG is $750 billion; bottom-up models, cheaper. JG outlays would replace or reduce the costs of much current anti-poverty spending (roughly $746 billion), with exponential benefits. The Treasury should finance a JG, but national, state or local agencies could administer it.....

Thanks to blogger and full employment supporter, Ben Leet, for this reference. jz

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

Wednesday, May 7, 2014

[NJFAC] persistence of long-term unemployment

US unemployment: A long-term trap

By James Politi, Financial Times, April 30, 2014

The level of extended joblessness is dangerously high, with grave consequences for the economy

....The stubborn persistence of long-term joblessness – more than six months without a job – has emerged as one of the defining features of the US economy in the aftermath of the financial crisis and recession.

While short-term unemployment has essentially returned to its pre-recession levels of about 4 per cent, it is elevated long-term unemployment that has kept the overall US jobless rate well above the 5.5 to 6 per cent level that many economists believe to be consistent with America's traditional economic potential.

....

According to the March jobs report, there were 3.7m Americans who have been without work for 27 weeks or longer. This represents 35.8 per cent of the overall pool of the unemployed, still well above pre-recession levels of around 18 per cent but below the peak of about 45 per cent four years ago. America used to have a share of the long-term unemployment far below the average of other advanced economies but by 2012 it had almost closed the gap with the mean for OECD countries.

The alarm bells grew louder in Washington last month after Alan Krueger, a Princeton economist and former senior aide to Barack Obama, released research showing extremely grim prospects for the long-term unemployed.

Among workers who had been unemployed for more than six months between 2008 and 2012, only 36 per cent were employed a year later, with 30 per cent still without work. The remaining 34 per gave up looking for a job and dropped out of the workforce altogether. Even more troubling, only 11 per cent had found stable, full-time employment for at least four months, Mr Krueger's study found.

"The longer somebody is jobless, the lower the chances they are going to find another job," says Keith Hall, a former commissioner at the Bureau of Labor Statistics now at George Mason University. "I worry that we are creating a group of people who are – I'm not going to say unhirable – but who are going to find it very difficult to ever get back into the labour force," he adds.

. . .

The main culprit of America's long-term unemployment problem is the depth and ferocity of the recession. But its failure to return to its pre-recession levels after five years of recovery has led to a flurry of studies by economists seeking to explain its stubbornness.

Some have pointed to discrimination as an important factor. In 2012 Rand Ghayad, a doctoral student at Northeastern University in Boston, sent out nearly 5,000 fictitious CVs and found a systematic bias against the long-term jobless, even when their qualifications were similar to those who had been out of work for less time.

"Employers are facing a huge pool of applicants and they can't hire everybody – so they have to pick the right person and unfortunately they think the length of time you have been out of work has to do with how productive you are on the job. They are using the length of unemployment as a symbol of productivity," says Mr Ghayad.....

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National Jobs for All Coalition
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