Why the solutions offered by the Fed and by corporate economists are dead wrong
"If we want more people to take jobs and we wish to live in a decent society, the answer is to pay people more." - well said. In addition, the executives should be forced by law to pay themselves less, a lot less - this would go a long way in reducing the absurd level of pay discrepancy.
The executives shipped millions of jobs to low-wage countries leaving those who lost their jobs in the U.S. in utter hopelessness. The money saved was pocketed by those same executives whose pay exploded as a result and the jobless millions were left to cope on their own as the government on every level failed to implement policies to help them so they were easy prey for Trump.
Charles Dickens must be turning in his grave to see the richest country in the world exploit its working class in the same way the UK did in the 19th century. Sadly, the USA is regressing and this is another example of the imminent decline of the American empire .... The greed of US corporations knows no bounds !!
Thank you, Dr. Reich. I agree with your whole analysis of our current situation and of what needs to be done to improve our situation.
The views of the Republicans consider only portions of the whole story, the portions that fit the defective 'solutions' they propose. And their proposals are all designed to ultimately serve the greed of those who already have more than they realistically need, all of which they have gained at great cost to all the rest of us.
it's predictable that corporations and GQP are hand-in-hand in this dystopian move to punish the citizenry for simply being alive and to impose austerity upon everyone who isn't uber-wealthy. it's all about controlling the masses. modern slavery.
the problem that the corporations and ultra-wealthy haven't yet solved is how to enjoy all the benefits that a modern society offers -- top-notch healthcare, scientific advances, transport, food, housing and its maintenance, interesting books and the various gadgetry that make life so fun -- whilst denying all those things to the rest of us. according to their plan, we are supposed to happily build, repair, maintain and provide all the amenities, all the everything, that the elites have and want, we are supposed to magically obtain the education and skills and tools necessary to accomplish these tasks, but after they take what they want from us, we are supposed to disappear into our hovels and remain out of sight until they require us to appear and to take care of >them< .
i look with suspicion at robots: on one hand, i think they are fun and interesting, but on the other hand, they are the new slave class of the 2030s and 2040s, whilst we, the deposed slave class, will all be collateral damage sacrificed upon the altar of absolute control and obscene profits.
who will these people destroy after we are all gone? each other.
Another thing to add to the woes of the working class, housing costs. If you aren't bringing in a paycheck to cover your basic needs [and in today's society working in any job requires 1. reliable transportation 2: a permanent address 3: a working phone 4: enough nutrition to get through the day 5. great health.] And that is just to get hired. Once hired you'd better hope you don't get colds,. covid, flu, or any other disease. Most good employment does not allow the accumulation of sick or vacation days in the first six months. And that is good companies. The average job now you're lucky if you ever get sick leave or vacation. Some businesses, in addition to lousy pay even make their workers stay on the job New Year's Day, July 4, Thanksgiving, and Christmas. They don't even recognize the other holidays.
The solution is simple. We just return to feudalism, sponsored by the church. We'll be grateful for whatever trickles down, and our children can learn trades as indentured servants. Might be a little tough on people of color, of course, because they'll face discrimination, but they have bootstraps, right? It's Republican Disneyland! And Barrett, Alito, Kavanaugh, Thomas, and Gorsuch get to make all the rules!
This situation is also cruel to those still in the workforce who are under great pressure to carry heavier burdens in wildly understaffed and often toxic work environments. Labor shortage is felt every day by those still stuck in the corporate grinder. Corporations don’t “feel” the pains of the “shortage” they gripe about, they benefit from it and nurture it.
For example. Nursing schools from graduate to vocational crank out thousands of new nurses yet every level of healthcare remains "understaffed." Patients lay unattended for hours with beeping monitors and unanswered call lights. Because the nurses are all temps and either don't know what to do or have no motivation to. Why. Because temps get sometimes double the hourly pay of an employed nurse, and they can choose their hours. So the Masters of Healthcare pay more and get less and pass it on to you. G-d bless the brave nurses in NYC who are striking to give the good care for good wages they went to school for.
“Structural labor shortage.”
I don't think DOL BLS and the Fed have the whole story. IMHO many employers pay workers "under the table" and effects from price fixing and price gouging undermine the cost of doing business for legitimate employers.
Economists estimate that 18 percent to 19 percent of income nationwide is not reported to the Internal Revenue Service.. IMHO side hustling and the gig economy are becoming the new American dream, with nearly 70 million Americans earning cash under the table.
Evading taxes is a crime.
Fed policy is sending us into a recession. It's worse for retired people living on a fixed income than it is for the general public.
100% correct. My small business (15 employees) competes with fast food for employees. The only way we get people in the door is a bit more money and paid benefits. It's amazing how many small businesses won't offer PAID benefits.
"We all do better when we all do better." Paul Wellstone
All of what was said here is obvious. Mr. Reich has, as usual, described the situation in terms that are accessible and cogent. But something keeps eating at me. In order to have a decent society, don't we have to be a decent society to begin with? Sometimes we get close, but currently we are not. Our checkered past provides us with clues as to why this might be the case. We, like many of the civilizations that preceded us, have an uneasy relationship with things like kindness, commonsense, egalitarianism. In short, we are severely limited by a persistent culture of selfishness, greed, violence, and intolerance. This culture "worked" for a time (if you could actually call it that). But that time is way past. Ultimately the solution to this mess is not going to come from current politics, religion, economics, science or technology. It will have to be a sea change in the way we see the world and our place in it. The previously mentioned things will then follow in good order. What we need, in short, is a modern axial age. All of the things that Mr. Reich has mentioned are obvious, good and sound, But without a social context decent enough to recognize and implement these very good recommendations the effect will be like planting wheat on a concrete sidewalk.
It's not a labor shortage but a productivity deficit caused by the American labor model.
If the "the corporate Republican argument" were correct then the mill worker economies of Northern England in the 1800s into the arly 1900s should be the role models of how to run an economy. Work people to death, keep them in poverty, and then replace them with new talent generated by a lack of birth control.
Looking at today's realities in Northern England might leave a different impression. The region has gone from struggle to struggle to get past the legacy of the mill works economy when the textile world moved on to Asia. Rather than a growing population and prosperity it is de-populating as jobs and industries have moved to Asia.
We can do better! Why not a 4-day work week? Why not give people sufficient time off to rest, build relationships, and enage in life long learning?
Perhaps a difference in approach to productivity may explain why France (yes, France) has much higher worker porductivity than the U.S. See https://www.huffpost.com/entry/why-the-french-are-more-productive_b_7179390
"Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities. It is two electric power plants, each serving a town of 60,000 population. It is two fine, fully equipped hospitals. It is some fifty miles of concrete pavement. We pay for a single fighter plane with a half million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than 8,000 people." --President Dwight D. Eisenhower, April 16, 1953, speaking to the American Society of Newspaper Editors at the Statler Hotel in Washington.
I agree one hundred percent. What if employers were taxed higher for paying employees below a living wage? For example, let's take a look at Walmart.
Walmart benefits by paying employees low wages. Often, the wages are so low that employees must get SNAP (formerly food stamps) to survive. Well then, who pays when employers like Walmart do not pay a living wage? The government pays and tax payers pick up the tab.
I think it's fair to say that the government and society have a vested interest that workers are healthy and self-sufficient. Government and society have a vested interest that employers pay a living wage so public assistance is not needed. So why not reward employers who pay their employees a living with a lower tax rate?
Perhaps a corporation's tax rate should be tied to the percentage of their employees needing public assistance, or earning a living wage?
It seems that incentivizing a living wage with a lower tax rate could make a win-win-win. Workers would benefit by making more and not needing public assistance. Businesses would pay a lower tax rate, creating lower worker turnover and more trained employees. The government and society would benefit by having fewer people and families needing public assistance. I don't know, but incentivizing a living wage with a lower tax rate seems like good solution for workers, employers and tax payers.
Before the Pandemic, I had an interesting chat with a Walmart manager on the day before Thanksgiving. On this day, the line for a cashier (and robot cashiers) was half way to the back of the store. It was very frustrating. Customers were angry. I decided to speak with a manager. In a polite manner, I pointed to the long line and asked, "why would Walmart do this to their customers? Some won't come back. It's the day before Thanksgiving. You had to know that this would be a busy day. Why are only three lanes open?
The manager explained that he didn't have enough workers. He said they even dropped the no smoking weed requirement, and they still couldn't get enough employees. Well then, why could they still need more employees, pray tell?
Having been in the fight for a living wage for several years, I asked the manager, "what is the starting pay?" He said $11.50/hr, as I recall. I replied, "Well there you go. This is Metropolitan DC. It's an expensive area. A living wage is at least $15/hr." The manager looked at me with a sad look, paused for moment, and nodded in agreement.
It was a cordial chat. I thanked him for his time. He thanked me for my patience. We wished each other a happy Thanksgiving. Indeed, paying workers more would solve the so-called worker shortage.
Here's a question. How do people who don't work pay their bills? From my experience, unemployment benefits never came close to substituting for even the worst paying jobs. It runs out after 26 weeks here in Georgia, and that wasn't usually enough time to find a decent job. Maybe things have changed since I was in the job market, but I'm sure most people, even the lazy slobs Robert referenced have to work at least one job, or risk losing everything and finding themselves living on 2nd Ave. in a tent. However, there is something severely amiss with the world economy. I know it's true that many business owners have trouble filling jobs, but I'm sure if the job paid enough, there would be resumes arriving en masse. I ran some businesses where it was difficult to find good workers back in the 90's, but I promise that was due to my bosses cheap pay schedules. Try running a business when you know you can't pay your help enough. Anyway, there are many major problems afflicting the economy. We all know what they are. I paid $5.08 for a dozen generic eggs at Walmart here in Georgia. There's something really wrong, and it's not all the fault of the Avian flu. I'm getting really concerned now. I don't think there's anything President Biden can do because one would think he would have already done it. It's not like he doesn't want to fix it. I'm thinking in terms of price controls. We already have shortages. We just can't let the business leaders raise prices whenever they feel some slight pressure. Prices have gone up so much they will never return to pre Covid levels. That sort of thing never happens. We had better get a grip very, very soon, or the country and the world will be up the creek without a paddle.
Very few of us are taking any kind of government handouts! At 72, I am entitled to my Social Security, which I paid into for years! However it is only $900 a month, because as a woman, I was paid crap wages. I supplement like everyone else, with work on-line through an etsy page and 'how to' you tube videos. Many of us found we could make a living online during the shut downs for covid. We are self employed because it saves on transportation, clothing, childcare, eldercare, and other work expenses. No one is lazily living off the government, there are no handouts available to anyone! We are industrious and will use our talents to support ourselves in poverty! We will not submit to less than a living wage to make others wealthy. If we must live on survival wages, it will be through self employment and cash under the table paid by rich creeps who won't legally employ domestic help! We will survive in spite of corporate greed!