Wednesday, November 14, 2007
I got the bright idea that if Adam Smith had been born 50 years later and lived to observe the industrial era he would have added an easy to understand delineation of the "race to the bottom" to his insights -- the race to the bottom being the chief difference between his era of more or less natural perfect competition among small entrepreneurs and skilled artisans, and the industrial era of 100 times more productive but interchangeable workers who are solely dependent on big entrepreneurs for the tools of their trade (e.g., steam looms).
I hope to come up with a simple delineation to serve in Smith's missed out on place -- not that I am any big brain; I just suspect that, from what I have seen so far of unfettered- free market misconceptions, untangling the economic truth may not be too un-simple. Anybody who wants to try, please have at it.
Typical Republican economic fairy tales: Newt Gingrich on Hannity the other night (same as Mailer broadcast) attacked the card check as depriving workers of the right to free unionizing elections which right he claims 90-95% of Americans support. Of course, the "Catch 22" election that Newt is talking about is the election that labor cannot get because of the gauntlet set for labor to run by current so called-labor law and super-bean counter management -- which is why labor is going for the card check in the first place, Newty baby. I assert that 90-95% of Americans might support a union election in EVERY work place (you don't have to run an obstacle course to vote for mayor), periodically, or that unionizing elections may be triggered by a 10% card check (the same percentage that triggers political party participation in nationwide presidential debates (e.g., Ross) and could plausibly be used to trigger public campaign matching funds -- or some equivalent of easy access unionizing elections.
Monday, September 24, 2007
Thursday, September 13, 2007
Sunday, September 2, 2007
If the exclusive to federal grand juries (crackpot) rule that the Fifth Amendment no longer applies once you answer any question at all on a particular line of inquiry – “once you open the door” – were to somehow propagate throughout all the American court system, state and federal, the immediate result would surely be a national outcry for a constitutional amendment to get our precious Fifth Amendment back.
But as long as it only exists in one (mostly hidden) venue the federal grand jury system gets away with it.
The “once you open the door” silliness could even enter the police station: Miranda (not that I’m in love with Miranda) might no longer be able to protect your right to remain silent: once you answer any police question.
The founders’ Fifth Amendment intention was to prevent torture. Does “opening the door” permit torture?
Wednesday, August 29, 2007
The poverty line in this country is set at three times the cost of an "emergency" diet (wherein you may not purchase a can of beans, only dried beans). I move that the federal government move immediately to a poverty standard of six times an emergency diet which is much more in keeping with 2007 basic needs (eg., $40,000/yr for a family of four).
Market failure implies that markets are for some (as far as I can see) unexplained reason expected to produce "fair" outcomes. The "free market" should be seen as analogous to the operating system of a computer -- as the OS of the economy -- upon which may be imposed any fair or unfair checks and balances program.
The first such "program" imposed by industrialization in nineteenth century England was the race to the bottom. Individual weavers who made a decent living were replaced by 100 (?) times more productive steam loom operators who were reduced to, not just-enough-to-stay-alive income, but the lowest form of just-enough-to-stay-alive income: staying alive on oat cakes three times a day because they could not even afford wheat bread.
The idea that the biggest ongoing drama in human history -- who's going to eat whose lunch -- is going to be automatically fairly resolved by an unfettered free market is what psychiatrists might characterize as "magical thinking".
25% of Americans live below a realistic poverty line (double the official line -- see the 2002 book, Raise the Floor). I am willing to admit 25% below without assistance (food stamps, etc.).
This ties in neatly -- until the recent slight increase in the minimum wage -- with 25% of labor earning below the modern European minimum wage level (generally $9.50/hr). Of course in Europe that is accompanied by full medical, 4 weeks paid vacation, etc., etc., etc.
Which fits in with a New story in the "Globalist" : "The OECD recently updated its definition of 'the middle class' " -- now focusing on "the average worker" rather than on "the average production worker" -- the recalculation:
"A British middle class family with two children and two incomes of 100% and 67% of average wages still earns 40% more (in PPP terms, net of taxes) than their U.S. counterparts ($65,000 compared to $45,500). In fact, U.S. families in this category rank only 15th in the OECD."
Which also ties in with -- until the slight increase -- 25% earning less than the 1968 US federal minimum wage.
We have a near 1939 minimum wage ($4.50/hr -- no taxes) -- we have a prohibition (drugs). We have created a new organized crime base -- this time it black and Hispanic rather than Irish, Italian and Jewish.
I read Wilson's 1997 book, When Work Disappears at the same time I read Venkatesh's 2002, American Project. Wilson's study wrapped up (if I remember correctly) while the fed minimum wage was still about $7/hr. At this point the projects which had once been a place of hope (when factory work had yet to disappear and the minimum wage was closer to $10) had become crime ridden but not yet the gang controlled Hell that accompanied the minimum wage drop to $5/hr. Better to make "all of" $10/hr selling drugs.
If work paid in America like it pays in labor controlled Europe (I'm no big lefty, BTW) poverty in America would not exist any more than it does in Europe. (Minority schools would work too if the parents worked; a.k.a., were paid enough to work -- forget worrying about the teacher's union).
A $500/wk minimum wage would add less than 4% to cost of GDP output (going from the $5.15/hr level!) -- about how much we grow per capita every two or three years -- up from $380/wk in 1968; following 100% increase in average income since. All we ever had to end poverty in America, it turns out, was to pay people what we could afford to pay them.
Friday, August 10, 2007
THIS ENTIRE MESSAGE IS IN THE PUBLIC DOMAIN
Sunday, July 22, 2007
The projects were a place of hope as Wilson's story started out, before -- reasonably paying -- work disappeared. The projects ended in gang infested hell as the minimum wage virtually disappeared to a pay level that American born workers would show up for.
My contention is that if American labor looked after its interests in the robust way that European labor does -- especially with Americans' greater tendency to be workaholics -- that the jobs left behind would have paid more than enough to keep hell from taking over urban minority life. IOW, the Crips and the Bloods could not whip a decent paying Ronald McDonald.
One Chicago U. economist found that drug dealing only pays about $10/hr for all but the very top leaders (even the economist's gang leader lived with his mother). Who would choose that over the European minimum wage (also the 1968 American minimum wage) of $9.50/hr -- supplemented in Europe with paid vacations, holidays, maternity leave, etc., etc., plus paid medical -- AND NO JAIL?
Enough money is here somewhere -- just as enough is enough in Europe (where people work one-third less (many fewer hours X many fewer family members working) -- to pay Americans enough to free all from ghetto hell (remember: the schools wont work if the parents wont work; and American born parents wont work if you don't pay them enough).
The US Census family income survey says top-fifth families AVERAGE $176,000 a year. But the survey contains a check box marked "over one million dollars" -- which means the survey "top-codes" all income over a million out of its report. Adjusting for that (by matching family growth with un-coded per-capita income growth) gives me more like $250,000 AVERAGE income for the top-fifth.
I hardly need point out that one out of five families in the US are not earning anywhere near this level (unless they live in lower Manhattan, where wealth is a plateau not a pinnacle).
Much more to the point: $250,000 a year is the average pay of the better paying medical specialties. $150,000 is the average income of today's primary care providers (the latter down 10% from 1995 to 2003 -- while average income in the US grew 12%).
Average income climbs 10-15% every decade (not even counting the free advances of technology) -- while 95-99% of American incomes stand still or go down -- and are going to keep standing still or going down until Americans realize they have to organize labor here the modern every-where-else-in-the-world way: some kind of legally mandated, sector-wide, labor agreements.
The Newt Gingrich, Chicken Littles of the world call every progressive European innovation "socialism". Interestingly, right-wing Europeans have no objections to strong unionization -- but only carp about over-regulation (cannot fire anyone) and over-welfare (automatically on the dole if out of work) as they should.
Just keep saying to yourself, over and over: "The Crips and the Bloods could not whip a decent paying Ronald McDonald", "The Crips and the Bloods could not whip a decent paying Ronald McDonald", and you will know all you need to know about untangling the multi-factor web of deep-seated urban pathologies. :-)
Thursday, July 5, 2007
One million prisoners doing hard time at any given time.
More millions have done hard time at one time.
Perhaps ten million with life ruining, unnecessary felony convictions -- even if they did not go to jail.
One hundred million addicts saved? Maybe not one.
A "very enlightened" policy whereby we threaten to ruin your life: we will break up your family, we will take waste your years, we will make you unemployable thereafter -- if you take the chance of ruining your life using a dangerous drug.
Meantime back at the economy: we have had a 1939 level federal minimum wage level ($4.50/hr, w/no taxes in FDR's era -- adjusted for inflation) to combine with the prohibition. What do we naturally get?: street gangs selling prohibited substances. Only difference between the today and the '30s: the gangs are African-American and Latino instead of Irish, Italian and Jewish.
What a wonderful set of ass-backwards policies.
Wednesday, July 4, 2007
I think they just cannot understand how war could make any sense from the perspective of their rich, symbol manipulating (IOW, normal modern?) existences – have a lot harder time understanding anyway.
To fully understand Vietnam you have to look from the perspective of the time: 20 years before the decision year (1965) two little fascist nations almost took over the world (mostly Germany – we only directed 15% of our own war effort at Japan). Now, the two big communist nations that the two little fascist countries could not bite off were coming for us – one with 11 times zones; the other with a billion people; both with thermonuclear arms. Neither Kruschev nor Mao made any secret of their intention to “bury us”.
PS. At the time the Soviet economy was growing 7% a year to our 3% (as far as we knew) -- the Russkies were graduating twice as many scientists and engineers as we were – and they ahead of us in space and in jet engine technology (as far as we knew -- our intercontinental bomber had 8 little engines to their 4 big ones). In 1965, communism was at high tide.
In strategic terms, Ho’s invasion of the South represented the craziest communist dictator willing to kill millions of his own people to add on a little bit of communist real estate. Our fear: if the democracies rolled over and did not put up a fight, we might face every less crazy communist leader comming out of the woodwork to try to take over the real estate next to his.
More widely, we could expect every “Che” in the world to step up his attempt at home based revolution. You may remember LBJ’s recorded phone remarks that he was afraid if he let go in Nam “the communists might chase you right back to your kitchen.” Don’t forget: the psychological is to the physical as three is to one – just to keep folks on our side we felt compelled to win the race to the moon; we feared backing away from a fight could have far reaching consequences too.
PS. The “big lesson” of WWII – which I have only realized is bunk lately – is that if Chamberlain had not “appeased” Hitler, there would never have been any WWII – obviously if the guy was going to invade Russia there was going to be war.
Is this going on too long?: it is the justification for a way that killed 60,000 of us – and millions of dead Vietnamese.
By 1975, when we lost locally, we were winning globally (even if the locals weren’t) – communism was receding.
The best portrayal I have seen of the struggle with communism over those ten years is Thomas Lipscomb’s “Prosperous Southeast Asia Proof the U.S. Did Not Fight In Vain”. Note: the free Southeast Asia nations are the ones that showed the world (including China) how to raise the poorest people in the world to near Western prosperity.
Oh, did I forget, after all this – definitely too long – we might have won the war after all but then threw it all away. Seems that for the last three years the South Vietnam Army took over all the ground fighting – AND WE CRAZILY (!!!) WITHDREW THEIR FINANCIAL SUPPORT AND THEIR AIR SUPPORT. Congress was upset so we took our bat and ball and went home. According to a book by ex-CIA employee Frank Snepp, Decent Interval, we had a guy on the politobureau in the North who reported they voted to throw in the towel after Nixon’s Hanoi bombing – but when they realized the South had to ration how many bullets a soldier could fire a day, etc., they started up all over again.
Saving the best (policy) for last, there was a proposition to call up the reserves and send four times as many troops (two million – saw this in Glenn… ). This would have ended it all fast and relatively bloodlessly, if very expensively.
Sunday, July 1, 2007
I am afraid that after two thousand years of going without a country Jews no longer know what to do with one when they've got one (some might claim "got one back"). After two thousand years on the move, maybe all they can think is: "neighborhood", "neighborhood", "neighborhood".
How else to explain well fed -- liberal -- Israelis living complacently down the road from painfully poorer Arabs within Israel proper: the Arabs seeming to them more from unrelated neighborhoods than from any overall society.
Ditto for settlements in the occupied territories -- just more neighborhoods. If poor Arabs are not content to be poor somewhere else (move down the road; "How much difference can that make?"), but actually have the temerity to fight back (if often immorally -- but who invented the truck bomb?), they are always terrorists, never patriots.
The geopolitical concept of "sovereign-territory invading sovereign-territory" endlessly eludes Israelis where Palestine is concerned -- which is why the dots between Israel's American giant military/political/economic support and mad (by both definitions) Arabs blowing holes in New York City fail to connect also (Americans by and large fail to connect the dots, too -- 2 far for 20/20 vision?).
Word to Israel: You have been away for two thousand years. Two, two hundred year old technologies have "lately" altered the psychic landscape: the railroad and the telegraph, which made national borders feel both much less flexible and much more "sacred".
Back when the furthest you could extend your personal influence was how far you could ride your horse in one day (if you could afford a horse), the further reaches of your political realm might seem like the far side of the moon -- life was mostly "neighborhood". The railroad and the telegraph pulled the continental US together to the point where African slavery that was tolerated in the North in 1800 had become too close for psychic comfort by 1850.
The medium could be the message in the nineteenth century, too.
If Israelis ever get the message -- to go along with their country -- they will at last heed the need to cease, 24/7/365/40, provoking a billion-plus potential Palestinian adherents to wage violent jihad against David -- and his big friend Goliath.
If I were President of the United States I would send the Marines into Gaza to liberate that country. There being no Israeli troops there, the most important intention would be to develop the psychological concept of Gaza as a real country who can invite whomever it pleases.
I would follow that up by sending American or coalition troops into the West Bank (by Palestinian invitation) to promote the same psychic-geopolitical notion there. Israeli troops would not dare to fire on American troops -- geopolitical suicide.
Coalition troops would open the Israeli-only highway system to all (except perhaps one day a week when it would run only one-way: out), end check-points, allow Palestinians to drill water wells wherever they would, block new settlements of course and most importantly move all Israeli military without a shot being fired...
...all of which should make continued residence untenable for the great majority of Israeli settlers -- without so much as addressing a word to them.
I don't believe that Palestinians would harm a hair on Israeli settlers' heads -- at first; while waiting on a negotiated shake-out. I take the Palestinians to be the easiest people on earth to get along with -- after ever mounting Israeli abuse all they seem to ask is to be left alone. I suspect the Irish would have stormed Tel Aviv, by now, swinging broom sticks if that were all they had, if they had been subject a tenth of the same abuse (authority: I have 5 Irish grandparents counting my mother's step-mother).
My method would be to "fester" -- not "force". All would be calculated to firmly establish in Israeli psyches that the West Bank and Gaza are in fact another country -- not Israel's outback. The psychological can outweigh the physical as three is to one when opposing an illegal occupation, too.
How hard would it be for settlers to move back to Israel? How hard was it to move to the West Bank in the first place -- or would it be to move to Brooklyn? Moving would be much cheaper in the long run than maintaining as many tanks at the ready as Western NATO and the US armies combined -- on 1% of the population base -- and infinitely less costly to the Western liberal psyche.
Maybe the settlers might not have to go; not all anyway -- as long as the Palestinians held complete sovereignty and control. Seems a shame to waste all that nice real estate development that Palestinians could not afford to keep up, when both sides can profit. Perhaps the poorer Palestinians will rent the settlements back to the richer Israelis; maybe not even to the same Israelis; maybe to all comers; all the market will bear (and sell the Israelis the water resources they have been raiding, too)! Could mean a humongous amount of money for third world Palestinians to catch up on lost development with and hopefully not too much for first world Israelis to fork over (hey; this is the Middle East; you bargain) -- all hinging on the Palestinians keeping total and absolute control.
Friday, June 29, 2007
Wherein the Court found a species of privacy in the Constitution that was so broad in nature that it doesn't prohibit the legislature from prohibiting anything specific (if you want to constitutionally protect abortion you really need to specify abortion) -- just requires legislatures to balance the state interest against privacy, which is what legislatures are in business to do anyway.
The right to privacy does give the Court a peg to hang its substantive hat (the comparative worth of the fetus) on...
...which the Roe Court then incongruously declined to do. Lawrence Tribe: "One of the most curious things about Roe is that, behind its own verbal smokescreen, the substantive judgment on which it rests is nowhere to be found." (HLR, Vol. 87:1, p. 7)
I would speculate that because even possible human life should add up to a compelling state interest (Roe's "fundamental" privacy sets up a compelling interest test) Roe was forced to switch off at the last minute to what I term a CONSENSUS test: "... we do not agree that, just by adopting one theory of life, Texas may override the rights of the pregnant woman that are at stake." Roe's deux ex machina?
Oh, and don't forget Roe's non-explanation for why the fetus becomes compelling at viability: "... at this point the fetus is presumably capable of meaningful life outside the womb." Tribe, again: "Truly this mistakes a "definition for a syllogism" and offers no reason at all for what the court has held." (ibid. at p.4)
Got to watch out for those "unprincipled" conservatives appointed by Bush, though.
Wednesday, May 23, 2007
If the Timex I wear today cost half what it would because it is made overseas, that frees up money for potatoes. That it keeps immeasurably better time (almost immeasurable error) cannot be traded off for more of anything else.
Add value that cannot transfer should be counted as unfungible added income. Lucky American consumers; we get to keep up with some part of average income increase -- that the market could not squeeze out of us.
Only God could figure the right inflation number for by a more powerful computer at the same price (and I am sure He would have a very interesting explanation). Meantime, for we human beings, it is enough to know that the price of the computer went up or down so much and the power went up or down so much. Any attempt to melt the two together would leave us with something akin to Heisenberg's uncertainty: unable to delineate cost and value (as in, position and momentum) -- in other words, a not very helpful measurement.
Ironically (hypocritically?), Hedonics believers advocated an inflation measure (C-CPI-U) that would have skipped over changes in value if they pushed inflation numbers in the wrong direction. If the price of pork went up -- forcing consumers to eat more rice (because cheaper; not because they are going macrobiotic) -- C-CPI-U would have allotted less weight to pork in the basket of goods used to track inflation and allotted more weight to rice -- as if the substitutes were voluntary instead of led by price changes. Republican logic.
Wednesday, May 16, 2007
To fill out the billion Indian comparison: 150 million American settlers would have to have carved out -- extra -- room for themselves. What today's 300 million Americans face are the least rational responses of the Palestinian people's billion-plus co-religionists for what they deem our role in the "dozerkrieging" of Islamic land.
The accidents of history make it easier for America to take the rap for Israel's mis-doings: Israelis speak the same language, live the same lifestyle, the other half of their ethnic group lives by and large in the United States, their people even gave rise to our Christian-Judaic culture.
An Israeli defense analyst recently worried that, for all Israel's local conventional and nuclear preponderance, her continued existence could be called into question by a single nuclear strike on Tel Aviv. Enough Israelis might, then, take flight for safer climes to insure others followed and so on.
Country emptying could be just as likely to play out with nuclear material-free bomb works* (no plutonium core) -- snuck into Tel Aviv and left to be discovered -- with no one to blame and no reason to fully retaliate: the perfect nuclear blackmail?
Could the shadow of nuclear blackmail drive Israel to the ultimate mad option?: go Stanley Kubrick and deploy a doom's-day device -- that does its dirty work without the possibility of human intervention? (Witness Israel's recent nation blasting over a couple of POWs.)
In real life Israel hasn't the thermonuclear technology to build a full-fledged, civilization ending weapon (see Herman Kahn). Possibly Israel could improvise a poor man's version -- arraying half (100?) her Hiroshima type bombs widely and deeply enough underground to blow millions of tons of matter into the upper atmosphere, triggering nuclear winter.
-- or -- alternately --
Israel could adopt the ultimate sane option (practiced by successful first-worlders everywhere): no more "dozerkrieging" next-door neighbors, no-choice returning misappropriated land and homes and no fair waiting until resistance ends before doing both (it works the other way around). A growing Arab consensus can assure Israel that withdrawing the unbearable occupation would do more for her genuine security than embarking on mutually assured destruction.
In the twentieth century, a smart Jew gave the world E = MC squared.
Twenty centuries earlier, a Smarter Jew (by me) gave the world: "Love thy neighbor as thyself, already" [A certain amount of "lingo" was culled from the New Testament for wider distribution -- always going to be more Gentiles, right?]
It does not take a Solomon to calculate that a nation of 5 million who occupies a neighbor of 4 million -- to park a few hundred thousand of her own on half their ancestral land -- will be condemned to exist always half-concentration camp and half-free. Oy!
[*Anyone could sneak nuclear-free bomb works into any city in the world in the hope someone else catches the blame. Anyone includes Mossad. Red Star Rogue recounts a credible tale of old Soviet hard-liners attempting to provoke a war between the US and China -- leaving the USSR the winner -- by staging what was to look like a Chinese sub nuking Honolulu, only to have the sub blow a hole in itself upon the attempt (and be later recovered by the Glomar Explorer). Any such event should be investigated as painstakingly as any airline crash in the expectation that the explanation may take the same kind of time to work its way out.]
Saturday, February 10, 2007
Back in the late 70s when I was driving for a car service in the Bronx I had more than one almost accident with police cars -- not chasing a suspect -- but rather whose drivers had ALREADY made an arrest and were so pumped that they blew red lights forgetting lights and sirens.
Last -- and perhaps most importantly: Justice White's dictum -- on which the prosecution theory lies -- did not comprehensively rule on the aspects of "imminent danger" as far as I can see. Justice White defended his opinion at the time that by explaining "It is better for all suspects to escape than for all suspects to be killed." That sounds to me like a rule that finds society's need to apprehend the suspect of less weight than the suspect's Fourth Amendment rights -- not a rule that says finds imminent danger to the officer's life automatically outweighed by the suspects rights.
End poverty in 30 years: said John Edwards a few months back. Better to return 40 years back, to when....
Who can fault with the education or self-discipline of third and fourth-quintile income American families....
...or, just enough to subsidize buidling the 16.5 million cars and trucks we manufacture every year as LITHIUM, PLUG-IN hybrids -- at $10,000 per vehicle!
Now, with oil in range of $150/bbl, we are shipping $500 billion more a year overseas; potentially justifying any form of subisidy for the manufacture of lithium plug-in hybrids. At the very least we could re-direct the flood of dollars into our own pockets -- even if the subsidy only broke even on savings -- even if the subsidy did not save multiples of itself (which is much more likely and which trend will grow over time).
January 2006 -- NOT YET REWRITTEN FOR THIS BLOG
Who would dispute that today’s Americans were living through a wage depression if a quarter of our workforce earned minimum wage – or if most, somehow, earned substantially less – and if the minimum wage we were talking about was that of two generations before?
In 1968, L.B.J.'s minimum wage was $9/hour (inflation adjusted, CPI-U) – our 25 percentile wage has become $9/hour (“State of Working America, 2004/2005”, table 2-6) – double the per capita income later!
Today’s federal minimum wage take-home is no better than F.D.R.’s, 1939 minimum of $4.20/hour (no tax) – meaning today’s just-above minimum wages must be comparable to just-above wages in the depression era – quadruple the per capita income later! I wonder how far up the wage curve the depression parallel holds.
Science fiction writers dream up wrongheaded Malthusian futures in which population growth outstrips earth’s resources (“Make Room! Make Room!; “Stand on Zanzibar”) – though advancing technology promises the opposite. Exponentially expanding production aside, the average American could be on the way to a bottom of the barrel future (who builds housing for the median income anymore?).
It all happened before – it was called the industrial revolution.
1800s English factory workers out-produced their individual artisan forbearers ten to a hundred times but ended up subsisting on oat cakes three times a day because they could not afford to eat wheat bread (Thompson’s “Making of the English Working Class”).
The common denominator of schizoid prosperities – then and now: the evaporation of labor’s bargaining clout.
Raising today’s federal minimum wage a dollar an hour would add six percent to fast food cost – but twenty percent to minimum wage purchasing power. Admittedly, raising the minimum from $206 a week to $246 a week won’t send any rush of new customers to the cash registers.
Raising the minimum wage from $5.00/hour to $12.50/hour would hike a six-dollar meal to nine dollars (the two dollar labor cost growing to five) – but the price of that meal relative to a minimum wage weekly paycheck would drop from 3% to 1.8% (the same percentage of a $330 a week income that a six dollar meal represents, today).
Should we keep fast food cheap for $500 a week earners at the expense of making life miserable for $206 workers? A $500 earner who spends $60 a week at McDonalds would need but $30 a week more to maintain his fast food fashion at 50% higher prices.
Overall inflation caused by a $500 minimum wage should only be 4%* -- not counting other wages pushed up.
Inflation can redistribute wealth from those who don’t get a raise to those who do – but recapturing labor’s share from CEOs, ballplayers and TV anchors who make 25 times their 1960s predecessors pay would take ruinous levels. Only a seriously unionized workforce can practicably re-take share from that high up the income scale.
1800s British workers designed to rebuild labor’s market muscle via protective legislation (‘twas to be their non-violent “French Revolution”) – but for them to so much as promote the vote (for all males) guaranteed, first, jail, and then, Australian exile (“1984” in 1804). The only thing perpetuating American workers on track to a “Freejack” future is their own complacency – even the 50% who would “rather be” unionized don’t sense any pressing “national emergency” – aided and abetted by an asleep-at-the-switch press corps (at least on labor matters).
Most untold story**: under the federal, stopped-clock-was-right in 1955, poverty formula (three times a crisis food budget), the poverty line for a family of four would be $72,000 a year by today -- had food prices risen twice as fast as other goods in the meantime -- instead of half as fast, leading to as foolish an official guideline of $18,000 (“Raise the Floor”, table 2-4). How alive to the great wage divide all America could be had a more alert media informed us poverty was rising from 15% in L.B.J.’s time to 25% – as it happened!
If and when America wakes up and smells the prosperity:
The most comprehensive approach – perhaps the only realistic hope – to end the American race to the bottom is (Germany’s tried and proved) sector-wide labor agreements, wherein employees working in the same occupation in the same geographic area must – by law – work under one and the same collectively bargained contract – even for different employers!
Sector-wide agreements could rebuild American labor’s bargaining power overnight – and reconstitute its political muscle – while eliminating pesky (contractless) scabs. A 1700s American scientist and philosopher might say: “Be not the first by whom the new is tried, nor yet the last to lay the old aside.”
THIS ENTIRE MESSAGE IS IN THE PUBLIC DOMAIN – for updates see: www.purpleocean.org/blog/80
PS. A Republican baked inflation formulation (C-CPI-U) would lower Social Security cost of living adjustments by going in opposite directions at once:
(a) taking fuller count of technological deflation (a same price TV now comes with a remote):
(b) while ignoring rising prices when consumers substitute less desirable,cheaper goods (less gasoline for more subway rides; less pork for more rice).
[ * A $7.50 hourly raise translates to an average yearly raise of $7500 for earners between old minimum wage and new. To the 54 million now below $500/week (“State of Working America, 2004-5” table 2-6) we add 6 million who get a full raise -- to get 60 million half raises. (1/3 up,1/4 down simplifier >) $10,000 X 45 million = $450 billion raise -- divided by $12 trillion GDP = 3.75% inflation.]
[ ** More missed misreporting: the Census reports top-fifth families taking 50% of all income – up from 40%, two decades back -- by “top-coding” family income above one million dollars out of its survey – adjust for “top-coding” by assuming overall family income doubled (over the same span per capita income did) and top-fifth rakes 60%!]
$9/hour has become the minimum wage norm in modern Europe – for now! England’s and Ireland’s minimums are scheduled to rise above that in 2006. The minimums of such poor countries as Greece, Malta and Cyprus cluster around $170/week (E600); a little less than America's.
“The United States of America of 1968” featured a minimum wage of $9/hour (at half of today’s labor productivity!) – scheduled to drop in future years (if we had had a crystal ball) to $8/hour by 1974, $7/hour by 1981, $6/hour by 1991 and $5.15/hour by today (which remits the same take home amount as the untaxed $4/hour minimum of 1939 -- in adjusted 2005 dollars).
European minimum wages – and their negotiated equivalents -- are adjusted annually – excepting the Netherlands (at $350/week) and Latvia every two years). The USA's 1997 minimum has stuck still for 8 years, now; 1991’s stuck for 4 years; 1981’s for 9 years.
The interesting thing here is that, if L.B.J.’s minimum could pay $9/hour at half of today’s American and European labor productivity, does that mean economies on both sides of the Atlantic could practicably support an $18/hour minimum wage today?! Just to pose the question.
A $12/hour, USA minimum wage would raise the cost of GDP output by only a manageable 3.5% -- not counting other wages being pushed up – and could effectively eliminate most poverty and crime levels that Europe hasn't had for a long time.