Thursday, March 15, 2018

[NJFAC] The Federal Job Guarantee--Paul, Darity and Hamilton, CBPP

The Federal Job Guarantee - A Policy to Achieve Permanent Full Employment March 9, 2018 Mark Paul^[1], William Darity, Jr.^[2], and Darrick Hamilton^[3]

....
At today's relatively low unemployment rate of 4.1 percent (January, 2018), 6.7 million workers remain unemployed, an additional 5 million are working part-time though they would prefer full-time work, and job seekers still substantially outnumber job openings.^[5] Moreover, this aggregate picture masks the fact that unemployment does not affect all workers equally. Historical unemployment data highlight the persistent trend of discriminatory labor market practices that result in substantially higher unemployment rates for some social groups. For instance, black workers routinely face an unemployment rate that is roughly twice that of white workers, even after controlling for educational attainment.^[6]^[7] There is recent evidence that narrowing of the racial unemployment gap occurs as the labor market tightens, but these gaps may be exacerbated during economic downturns.^{[8]
....Conclusion
A job guarantee would fundamentally transform the current labor market in the United States. Our current conception of full employment is inadequate; we discuss a bold policy in this paper to bring the United States to a permanent, more accurate indicator of full employment—by which we mean that everyone who seeks a job can find one at non-poverty wages. Beyond providing full employment, the job guarantee could be a turning point for American workers. Workers are faced with stagnating real wages and a continued erosion of labor's share of income. The job guarantee could significantly alter the current power dynamics between labor and capital—particularly for low-wage workers and traditionally marginalized groups.
Benefits of the program reach beyond those directly employed under the NIEC. If a job guarantee were to be implemented, it also would function as a de facto employment floor in the labor market. Private employers would have to offer wages and benefits that are at least competitive with the NIEC in order to attract workers. The universal nature of the program would ensure jobs for all—including those with some forms of disability who may not be employed through the private sector. The universal design is critical to ending working poverty and involuntary unemployment; this is in contrast to other forms of intervention in the labor market, such as minimum wage laws, which do not ensure access to employment in the first place. Nevertheless, complementary changes to the existing social insurance system would be necessary to eliminate poverty entirely, as some individuals may be unable to work for various reasons.^[54]
Despite the discussion of full employment as a national priority for nearly a century now, policymakers have failed to deliver an economy that prioritized employment for all. Full employment is a goal that the private market in unable to achieve, therefore requiring government intervention in the labor market. Above, we discuss a transformative policy proposal—a federal job guarantee—whereby the government engages in the direct hiring of workers at non-poverty wages to achieve, and maintain, a full employment economy. Whether or not policymakers agree with the specifics we suggest in our proposal, we encourage them to think about bold solutions to achieve and maintain full employment. Restructuring our public policies to eradicate involuntary unemployment and poverty is within our reach.}

Profs. Darity and Hamilton are on the Advisory Board of NJFAC. Hamilton will join Senator Bernie Sanders in a town hall on March 19th. See details below. jz

Senator Bernie Sanders will hold a televised town hall on March 19th to address the issue of economic inequality. Tune in live as Milano Professor of Economics and Urban Policy, Darrick Hamilton joins Sen. Bernie Sanders, Sen. Elizabeth Warren (D-Mass), and filmmaker Michael Moore on the four-person panel.

"The town hall, called "Inequality in America: The Rise of Oligarchy and Collapse of the Middle Class," will take place from 7 to 8:30 pm ET before a live audience in the auditorium of the U.S. Capitol. It will be broadcast online with the help of the event's digital media partners, The Guardian, NowThis, The Young Turks and Act.tv." – HuffPost

Tuesday, March 6, 2018

[NJFAC] High Wages Improve Economic Performance

Even McKinsey Gets It: High Wages Improve Economic Performance

Economic stagnation is the outcome of conscious policy choices.

By Marshall Auerback / AlterNet March 3, 2018

"After a year-long analysis of seven developed countries and six sectors," global management consultancy company McKinsey has "concluded that demand matters for productivity growth and that increasing demand is key to restarting growth across advanced economies." Which means—surprise, surprise—higher wages for the workforce. The report by James Manyika, Jaana Remes and Jan Mischke was published in the Harvard Business Review.
....

If deficient demand (and a concomitant commitment to full employment) is not considered relevant as far as productivity goes, the policy framework is very different. Fiscal policy is diminished because there is little point in "wasting" limited financial resources on fiscal stimulus, higher real wages, or a restructuring of the private debt overhang. And economic inequality doesn't even factor into the equation at all. Rising inequality, growing polarization and the vanishing middle class have all been seen as unfortunate, but inevitable byproducts of globalization, rather than drivers of slow potential growth.

By contrast, the McKinsey analysis leads to a very different policy outcome—one that places demand management and full employment at the heart of macroeconomic policy-making.....

ps from June: Some consider the lag in introducing innovations made possible by artificial intelligence partially related to low wages. [Obviously, a mixed blessing, given our limited social supports for the jobless.] For example, Kevin Cashman, https://theminskys.org/automation/

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

Thursday, February 15, 2018

[NJFAC] Wages Again? Yup. It’s a Swamp Out There, So Let’s Review the Facts

Wages Again? Yup. It's a Swamp Out There, So Let's Review the Facts Frank Stricker

Every other day, Mr. Trump and his cronies tell us that wages have increased since their great American policies began. And every other month, reporters discover a wage surge. Recently, you could have read that average hourly pay had risen 4.9% or 2.9% or some other substantial number. Reporters have been searching for a wage upswing for a long time, and especially now that unemployment seems low and demand for workers high. But unemployment is not so low, as is apparent in NJFAC's alternative monthly rate.

Sometimes reporters don't bother to talk about real wages, that is, after the effects of inflation are accounted for. They also tend to talk about the whole non-farm, private sector work force, which gives too much weight to the success of the minority that is doing well. We should be talking about rank-and-file workers. When we do, we find that real hourly wages went up--hold your breath--0.1% from December of 2016 through December of 2017. That's one-tenth of one percent for a year. How about January of 2017 through January of 2018? Still just 0.1%.

Thanks, Don. On Valentine's Day, the Vice-Liar in Waiting, Mike Pence, said that 4.5 million workers were getting raises because of administration policies. But the employed work force is 155 million and two-thirds of them are not doing well. The losers include Trump's white working-class supporters. Their pay is lagging and they are getting less than their share of new jobs; sometimes college graduates are getting jobs they used to get. Overall, wages for people in the top 40% are substantially higher than they were in the 1970s, but wages for the bottom 60% are about where they were 45 years ago.

Obviously wage stagnation is not just Donald Trump's fault. At least Trump talked about it. But he's done nothing to fix it. Will his white working-class supporters get tired of the circuses and look for something real? And will they find it? Will Democrats across the country in this election year promise to work for a $15 federal minimum wage? They did not do so in 2016. It's the very least they should be doing on the wage front right now.

Sources: Bureau of Labor Statistics, Real Earnings--January 2018, 2; Robert Shapiro, "The New Economics of Jobs is Bad News for Working-Class Americans--and Maybe for Trump," Brookings, January 16, 2018; The Hamilton Project, Thirteen Facts about Wage Growth (September, 2107), Fact 2.

Frank Stricker is Emeritus Professor of History and Labor Studies at California State University, Dominguez Hills, a member of the National Jobs for All Coalition, and has written What Ails the American Worker? Unemployment and Crummy Jobs: History, Explanations, Remedies.

Tuesday, January 23, 2018

[NJFAC] What explains wage stagnation?

Why Is It So Hard for Americans to Get a Decent Raise?

A new answer could change how we think about unions, monopolies, and the minimum wage. By Jordan Weissmann Jan 16, 2018

....
Since 1979, inflation-adjusted hourly pay is up just 3.41 percent for the middle 20 percent of Americans while labor's overall share of national income has declined sharply since the early 2000s. There are lots of possible explanations for why this is, from long-term factors like the rise of automation and decline of organized labor, to short-term ones, such as the lingering weakness in the job market left over from the great recession. But a recent study by a group of labor economists introduces an interesting theory into the mix: Workers' pay may be lagging because the U.S. is suffering from a shortage of employers.

The paper—written by José Azar of IESE Business School at the University of Navarra, Ioana Marinescu of the University of Pennsylvania, and Marshall Steinbaum of the Roosevelt Institute—argues that, across different cities and different fields, hiring is concentrated among a relatively small number of businesses, which may have given managers the ability to keep wages lower than if there were more companies vying for talent. This is not the same as saying there are simply too many job hunters chasing too few openings—the paper, which is still in an early draft form, is designed to rule out that possibility. Instead, its authors argue that the labor market may be plagued by what economists call a monopsony problem, where a lack of competition among employers gives businesses outsize power over workers, including the ability to tamp down on pay. If the researchers are right, it could have important implications for how we think about antitrust, unions, and the minimum wage.....

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

Tuesday, January 2, 2018

[NJFAC] Happy New Year, Sure, But Why Aren’t Wages Soaring?

Happy New Year, Sure, But Why Aren't Wages Soaring? by Frank Stricker

The official unemployment rate is 4.1%. That's full employment for mainstream economists. We'd expect to see wages on a long upward path, as employers compete for new hires. But average pay rises one month and falls the next. You may read that it increased 2%+ in the last twelve months, but after inflation is accounted for, much of the increase disappears. Higher minimum wage laws have helped in some places, but for the nation as a whole wages are not on the up-escalator.

President Trump tells us he is fixing everything. But from the inauguration through November, the average real hourly wage of a rank-and-file employee increased half a percent. If she was earning $20.00 an hour in January; she's earning $20.10 today. And the long-term trend is depressing. Real pay today is about where it was in 1972-1973. The U.S. added tons of new income and wealth, but not much filtered down.

To get insight into the wage problem and its causes, I sent our intrepid Untrained Economist (UE) to talk to Republican House Member and Freedom Caucus leader, Jordan Rabid.

Untrained Economist (UE): "Are you Republicans going to reward your working-class supporters by raising the federal minimum wage? It's just $7.25 and lifting it to $15 would help 40 million workers."

Rep. Rabid: "Higher minimum wages are a job-killer. You should know that."

UE: "Many studies show that lifting the minimum wage doesn't kill jobs or only a few, and that it cures a lot of poverty. It creates jobs too, because people buy more things and services."

Rep. Rabid: "We believe people should work harder, be more disciplined, go to church, stay married. That's what our President stands for."

UE: "I guess you don't want to encourage unionization, which raises pay and benefits?"

Rep. Rabid: "You are right."

UE: "When unions were stronger in the 40s, 50s, and 60s, wage growth was better."

Rep. Rabid. "Don't distract me. We need more incentives for the filthy rich--oops--wise investors, to create jobs. We have those in our great tax-cut legislation. And, hey, we have the word job in the title of the law; that's how important jobs are for us."

UE: "Most corporate leaders say they will use the gifts they are getting in the tax bill not to create jobs but to retire debt and buy back their own stock."

Rep. Rabid: "Where did you read that? More fake news from the Post and the Times."

Our reporter decided to tap another source, a Mainstream Economist (ME).

Untrained Economist: "So, Doctor, why haven't wages taken off? We're close to full employment, and the laws of supply and demand say that when workers are scarce, employers have to pay more for them."

Mainstream Economist: "It's a mystery. It must have something to do with workers' skill and schooling deficits. That's the kind of thing we like to talk about in the econ biz. Employers can't pay skilled wages for the unskilled. Pay and economic contribution must be equivalent."

UE: "Are you saying that many jobs cannot be filled due to skill shortages?"

ME: "Maybe. Let me get back to you on this."

UE: "The skill and education levels of workers have risen over four decades, but wages have stagnated. That's a fact. By the way, are you saying that people must have specialized skills to earn a living wage in America?"

ME: "Short answer: Yes. I don't make the rules, buddy. It's the way markets work. We don't want people like you tinkering with the dynamic, creative motors of the market system."

UE: "Some people think that other people have tinkered in very bad ways--killing unions, sitting on the minimum wage, moving plants, violating labor laws, manipulating money markets, and so on. Markets are rigged by companies and rich people…but you probably think that's a topic for another day."

ME: "We agree on that."

UE: "Let me ask you this. Quite a few economists and journalists think that productivity--output per hour of labor input--has to rise if wages are to go up. I guess they can't imagine where else the money for higher pay could come from. (Pause) Since the '70s, worker productivity has increased by something like 70 to 150%, depending on your measure, but the average wage of the average employee has not increased. Maybe it's not about productivity, but about inequality and power. The few grab too much.

"Let me preach a little. Capitalists and their servants have pushed policies that disempower workers. Undermining unions and laws that protect organizers, hiring more temps and contract workers, sending work out of the country, and, sometimes, keeping unemployment high--these things have eroded workers' bargaining power."

ME: "If you want to introduce the class struggle, go ahead. You know that Americans don't like talking about class. We're not really a class society."

UE: "I want to add one more important thing that disempowers employees. We are not actually close to full employment. If we estimate the number of people who want a job but are not currently looking for one, the real unemployment rate is twice as high. For most jobs there are plenty of people on the sidelines ready to step in. Employers don't seem to be having much trouble finding workers. They may have to make an effort--boo hoo--and they are not used to doing that any more. If there are shortages, it's often because employers are addicted to paying low wages.

"I know that some economists, including Janet Yellen at the Fed, hint now and then that labor markets aren't as tight as the official unemployment rate shows, but they don't talk about changing the official rate. Just to let you know, the Bureau of Labor Statistics has its own higher alternative rate, and so does the National Jobs for All Coalition at njfac.org."

ME: "You would have been smarter if you'd have gotten an economics degree at a good college like the University of Chicago. You know nothing about globalization, comparative advantage, the skill required to make business investments…so many things. A good economics department would have taught you to respect mainstream economics and capitalism. You'd be less iconoclastic. That kind of thing is not appealing in a middle-aged, middle-class person."

******************************************************************************

Frank Stricker is Emeritus Professor of History and Labor Studies at California State University, Dominguez Hills, a member of the National Jobs for All Coalition, and the author of Why America Lost the War on Poverty--and How to Win It (2007).

Wednesday, December 27, 2017

[NJFAC] "Radical economic populism is the only thing that can save the Democrats now" The Week

"Duke economist William Darity Jr. has recommended guaranteeing public-sector employment at dignified wages to every American willing to work, providing a federally financed trust fund to every newborn, and rebuilding education infrastructure to offer gifted-quality K-12 education to all. What's especially instructive about Darity's plan is it's designed to be universal, while also getting to the root of the labor market exploitation and exclusion that plagues African-Americans more than anyone. Precisely because of that bottom-up design, these policies would also address the basic challenges facing working-class whites as well. That would lay the economic foundation for a multi-ethnic coalition that could appeal to white workers' livelihoods, while also actively challenging the bigotries and resentments that convinced so many of them to vote for Trump."

Radical economic populism is the only thing that can save the Democrats now, Spross, The Week, 12/17

Prof. William Darity, Jr. is on the NJFAC Board of Directors.

https://njfac.org/index.php/education-tools/noted/

--

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

Tuesday, December 12, 2017

[NJFAC] Webcast of "A New Deal for NYC & the USA "

View Webcast of "A New Deal for NYC & the USA (10-27-17) at the New School" Part 1 Part 2
A New "New Deal" for NYC & the USA – The New School
Event Program October 27, 2017

Welcome
Dean William Milberg, New School for Social Research
Prof. Robert Pollack, Director, Columbia University Seminars
Prof. Franklin D. Roosevelt, III, Economics Emer., Sarah Lawrence College

Introduction: The Dual New Deal Legacy: Celebrate, Advocate
Prof. Gertrude Schaffner Goldberg, Emer., Adelphi University; Chair, National Jobs for All Coalition;
Co-Chair Columbia University Seminar on Full Employment, Social Welfare, and Equity

The New Deal Legacy in New York City and a Call for a New, New Deal
Gray Brechin, Geographer and Founder, Living New Deal

A 21st Century Civilian Conservation Corps
Rep. Marcy Kaptur (D-OH), Chief Sponsor, H.R. 2206, 21st Century Civilian Conservation Corps Act and
Co-Sponsor H.R. 1000, 21st Century Humphrey-Hawkins Full Employment and Training Act

Political and Economic Prospects for Achieving a Federal and a New York City Job Guarantee: A Panel Discussion
Prof. Darrick Hamilton, The New School
Prof. Philip Harvey, Rutgers Law
Prof. Stephanie Kelton, former Chief Economist, Senate Budget Committee & Stony Brook University
Prof. Randall Wray, Levy Institute, Bard College

Creating Jobs and Building Great Things Again in New York City
Bich Ha Pham, Director of Policy, Office of NYC Public Advocate Letitia James

PUBLIC PROGRAM SPONSORS:
Columbia University Seminar on Full Employment,
Social Welfare, and Equity
National Jobs for All Coalition
New School for Social Research

CO-SPONSORING ORGANIZATIONS:
CELEBRATING A NEW "NEW DEAL" for NYC & the USA
(in formation)

1Future
Columbia University Seminar on Full Employment,
Social Welfare, and Equity
CWA Local 1180
Designing the WE
District Council 37, AFSCME
Four Freedoms Democratic Club
Greater New York Labor-Religion Coalition
Harlem Congregations for Community Improvement
Judson Memorial Church
Levy Economics Institute, Bard College
Metro NY Health Care for All Campaign
Modern Money Network
National Jobs for All Coalition
New School for Social Research
New York City Department of Records
New York Labor History Association
Professional Staff Congress/CUNY, AFT
The Labor Council for Latin American Advancement NYC
The Living New Deal
WeAct for Environmental Justice
Worker Institute at Cornell ILR
Workers Defense League

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

Thursday, March 15, 2018

The Federal Job Guarantee - A Policy to Achieve Permanent Full Employment March 9, 2018 Mark Paul[1], William Darity, Jr.[2], and Darrick Hamilton[3]

Conclusion

Tuesday, March 6, 2018

Even McKinsey Gets It: High Wages Improve Economic Performance

Thursday, February 15, 2018

Tuesday, January 23, 2018

A new answer could change how we think about unions, monopolies, and the minimum wage. By Jordan Weissmann Jan 16, 2018

Tuesday, January 2, 2018

Wednesday, December 27, 2017

Tuesday, December 12, 2017

The Federal Job Guarantee - A Policy to Achieve Permanent Full Employment March 9, 2018 Mark Paul^[1], William Darity, Jr.^[2], and Darrick Hamilton^[3]