Jobless Rate: The Truth Bubble?

[Slimprofits]

Re: Jobless Rate: The Truth Bubble?

I've been looking for some extra work.

I've applied for a few jobs this week and heard back from four of them.

Of the four, two were legitimate companies.

Of the two non-legit, one was a new version of the Nigerian scam and the other was an even more creative attempt at stealing my bank account numbers.

[santafe2]

Re: Jobless Rate: The Truth Bubble?

As far as I can tell, fascism is on the upswing in the US. If it's going to be purged, there's still a long, long way to go.

You, and your allies support for this idea will likely lead to a 21st Century Holocaust. You say humans should not reaffirm the American ideal, they should be glad to work under 3rd world conditions. You make me sick. That you can post this sick crap on iTulip without official rebuke is the reason I only occasionally post here any longer. Eric and the Freds have got to get you sick bastards under control.

[Raz]

Re: Jobless Rate: The Truth Bubble?

You, and your allies support for this idea will likely lead to a 21st Century Holocaust. You say humans should not reaffirm the American ideal, they should be glad to work under 3rd world conditions. You make me sick. That you can post this sick crap on iTulip without official rebuke is the reason I only occasionally post here any longer. Eric and the Freds have got to get you sick bastards under control.

You lost the argument.

Your cannot refute the arguments Sharkey put forth because they are based upon economic reality. You might as well scream and rant against gravity, saying that those of us who state that water will never flow uphill on its own are fascist thugs "grinding our heel into the face of humanity".

"You sick bastards"? Yeah, right. If we don't agree with your fabricated view of "reality" then we're Nazis, Fascists, heartless thugs, "sick bastards", etc. Classic Leftist tactic, right out of Alinsky's handbook. When you've lost the argument simply change the discussion into one of how evil and heartless your opponent is.

Hope you do quit posting. I sure won't miss you.

[Rajiv]

Re: Jobless Rate: The Truth Bubble?

Another point: much of the world works for less than US minimum wage, and survives just fine. What makes Americans so special that they can avoid economic reality? And why would it be considered so horrific for the US to act like other countries do when it comes to wages?

This is actually not quite true. Let us take the California Minimum Wage $8.00 per hour -- and transport that to somebody in India -- the living standard of that person earning $8 per hour (in purchasing terms and standard of living) is equivalent to that of somebody earning $80 per hour -- in other words >$160,000 per year, and would be in the top 5% of income earners in India just as $160,000 would be here in the US.

You say -- how is that possible -- it is because the exchange rate is determined purely by Internatonal trade and the printing of money by the FIRE sector -- it does not reflect the realities of life on the ground. The markets in this regard are extremely imperfect and subject to externalities. This another way for FIRE sector to shift money from the 90% of the US population to the the top 1% -- an empoverishment of the US population by the US financial elite.

So what you have asserted is untrue and quite misleading.

[santafe2]

Re: Jobless Rate: The Truth Bubble?

You lost the argument.

Of course. Humans should live as draft animals or worse if they don't measure up. Under your standard there is no standard too low for the lowest person. In society, humans have no rights above their economic value. You won't admit you're willing to bring back slavery but you'll be first in line when your system forces people to choose it over death. As I said, sick.

[Raz]

Re: Jobless Rate: The Truth Bubble?

Of course. Humans should live as draft animals or worse if they don't measure up. Under your standard there is no standard too low for the lowest person. In society, humans have no rights above their economic value. You won't admit you're willing to bring back slavery but you'll be first in line when your system forces people to choose it over death. As I said, sick.

Suppose there exists two small businesses: a landscaping company and a delivery service. Lets allow reality to intrude upon our view of the marketplace in which they are forced to operate and allow that they have (a) competition, and (b) very limited pricing power.
They each have employees who are paid $8.25 per hour, rendering them in your words, "draft animals".

Now let's suppose that Comrad santafe2 is able to prevail upon his Congressional heroes to raise the Federal Minimum Wage to $20.00 per hour, a "living wage" as he would describe it. At that point the owner/operators of these small businesses, (who by the way pays 1/2 of the Social Security for these "draft animals") can either (1) raise their prices, which will render their services uneconomical in the marketplace, or (2) work for $8.25 per hour while paying their employees $20.00 per hour, or, most likely, as a result of economic reality referred to in item #1, (3) go out of business.

I suppose your view is that it's better for such a business to simply fold and close down because it is "immoral" for them to exist if they cannot pay their employees a "living wage". And not only that, but I'm a "sick bastard" if I don't want to be robbed of my earnings in order to support those "draft animals" who have now lost their jobs due to the "compassion" of the U.S. Congress.

"That you can post this sick crap on iTulip without official rebuke is the reason I only occasionally post here any longer.
Eric and the Freds have got to get you sick bastards under control."

Well, Gruppenfuhrer, you apparently believe that those who don't agree with you
should be officially "rebuked" and brought "under control".

If you're looking for Fascists, try standing in front of a mirror.

[flintlock]

Re: Jobless Rate: The Truth Bubble?

Thanks for the reality lesson Raz. Some of us have a hard time living in it.

Some people think it is a given that we will always have businesses to work for. The flight of corporations and jobs from the US should be a wake up call. People are worth what the market will bring. Anything more is a handout regardless of what you want to call it.

I've never really been against the minimum wage. It was always so low and below the prevailing wage that it didn't matter much. But I can see how raising it has killed off some jobs. This Globalism that so many are fond of is going to continue to drive wages DOWN for many. So don't rail against the market. Rail against those who chose to lead us into a Global economy where the average American worker can't possibly hope to compete.

So many want to have their cake and eat it too. They want Diversity, open borders, commonality. The world as one big happy family. Only they forget that in a family you have to share. Part of that sharing means those who have more end giving up something. In America's case, it was jobs. If you want to help American workers give them a decent job, not a forced handout at the expense of other Americans, most of whom had nothing to do with this sellout. Once again the Oligarchs have succeeded in turning fellow Americans against each other while they walk off with all the loot.

[santafe2]

Re: Jobless Rate: The Truth Bubble?

Suppose there exists two small businesses: a landscaping company and a delivery service. Lets allow reality to intrude upon our view of the marketplace in which they are forced to operate and allow that they have (a) competition, and (b) very limited pricing power.
They each have employees who are paid $8.25 per hour, rendering them in your words, "draft animals".

Now let's suppose that Comrad santafe2 is able to prevail upon his Congressional heroes to raise the Federal Minimum Wage to $20.00 per hour, a "living wage" as he would describe it. At that point the owner/operators of these small businesses, (who by the way pays 1/2 of the Social Security for these "draft animals") can either (1) raise their prices, which will render their services uneconomical in the marketplace, or (2) work for $8.25 per hour while paying their employees $20.00 per hour, or, most likely, as a result of economic reality referred to in item #1, (3) go out of business.

I suppose your view is that it's better for such a business to simply fold and close down because it is "immoral" for them to exist if they cannot pay their employees a "living wage". And not only that, but I'm a "sick bastard" if I don't want to be robbed of my earnings in order to support those "draft animals" who have now lost their jobs due to the "compassion" of the U.S. Congress.

"That you can post this sick crap on iTulip without official rebuke is the reason I only occasionally post here any longer.
Eric and the Freds have got to get you sick bastards under control."

Well, Gruppenfuhrer, you apparently believe that those who don't agree with you
should be officially "rebuked" and brought "under control".

If you're looking for Fascists, try standing in front of a mirror.

Ok, I'll be a little bit nice and ask for a do-over. I liked the way your argument started but it went off course around the point that you equated $8.25 an hour with my draft animal reference and after that you just rambled.

I'm a business person. I run a business that pays all of our employees a salary on which I would expect to live and prosper. I completely disrespect your position and I suspect you have never run a successful business.

That you and others on this site are making the argument that US employees should work for wages as they exist in 3rd world countries disgusts me.

Try to focus on the issue. You are saying that the 'market' dictates the value of service and there should be no regulation to enforce a minimal standard. Humans as draft animals. If I've got that wrong, make a logical argument but don't ignore your previous posts on this thread.

[c1ue]

Re: Jobless Rate: The Truth Bubble?

I'd just like to point out that Dr. Hudson's theory that FIRE drives up wages and reduces competitiveness is a non-ideological (i.e. Right, Left, Republican, Democrat, Fascist, or Communist) view.

He asserts that the actions of FIRE are significantly a factor as to why US labor is not competitive in the world economy; in contrast Germany - which has as good a standard of living - is very competitive.

Germany (not coincidentally?) has real estate prices much lower than the US.

A closer example: Tortola (British Virgin Islands) and St. Thomas (US Virgin Islands). These two islands are literally right beside each other.

While certainly there are population density differences, St. Thomas is far more expensive than Tortola. Unsurprisingly real estate prices are also far higher. The driver or the cause? You decide.

Some interesting contrast:

http://www.globalpropertyguide.com/C...n/US-Virgin-Is

The property market in the US Virgin Islands collapsed in 2008, because about 80% of foreign homebuyers in the islands come from the US, where the global crisis started.

...

Despite the decline, real estate prices in the US Virgin Islands are still among the highest in the Caribbean region. In 2008, the average home price in St John was US$1.5 million while the average price of condominium units was US$634,923.
Foreigners can freely buy properties in the US Virgin Islands.

Same site: BVI

http://www.globalpropertyguide.com/C.../Price-History

In 2009, property prices were stable. Foreign demand for luxury houses has stayed strong, and banks are still willing to lend to qualified homebuyers.

...

The average price of three-bedroom houses along the Caribbean coastlines is now around US$1.2 million, while five-bedroom houses sell for about US$2 million.

Other factors in US labor competitiveness: health care, taxes (see Elizabeth Warren's work on 2 income family spending)

[Rajiv]

Re: Jobless Rate: The Truth Bubble?

Also, as I pointed out, comparisons of wages based on exchange rates are flawed, because exchange rates are based on international trade (a small subset of the total world economy) and currency manipulation by central banks -- see Perkins work (confessions of an economic hit man).

This flaw has been exploited by the FIRE establishment to the detriment of North American and British citizens -- a sucking of wealth from the bottom 90% to the top 1%. This has led to the paradoxical situation that SantaFe2 refers to, and Sharky, Raz and others fail to comprehend. The monetary system is deeply flawed, and leads to an extremely uneven playing field.

[dcarrigg]

Re: Jobless Rate: The Truth Bubble?

The solution is to break the tie between business and the state, in the same way and for same reasons that we have a separation of church and state.

How does this solve the problem of lack of access to capital? The sons/daughters of the wealthy remain as such weather or not that tie is broken - in fact, it may magnify the problem.

[dcarrigg]

Re: Jobless Rate: The Truth Bubble?

The markets in this regard are extremely imperfect and subject to externalities...
So what you have asserted is untrue and quite misleading.

Thank you Rajiv,

I grow weary of listening to folks repeat drivel from a microeconomics textbook written by someone in Chicago.

I also grow weary of the argument from the other side against rational actor theory - while I do not buy it - nor do I buy what Political Science and Economics have done to Weber's concepts, I do not think it is the primary problem. Still, this interview was okay: http://marketplace.publicradio.org/d...cago-school-q/

The main problem is a lack of understanding of complexity - only a fool would truly believe what is written in those text books - smooth supply and demand graphs - trade offs between inflation and unemployment - it all works until it doesn't, discounting the rare events that keep coming up as "exogenous shocks," and preaching the lessons of the Chicago School and Laffer Curve as gospel.

Unfortunately, some treat efficient markets theory as dogma, and will fight viciously if one offends their beliefs. All of the evidence in the world to the contrary could not immediately convince the Church of the fallacy of the Ptolomaic model of the universe - and it will take some time as well to convince others of the fallacy of economics.

[wayiwalk]

Re: Jobless Rate: The Truth Bubble?

I think the "I"m a businessman and you're not" argument doesn't tell enough - experience isn't everything in this argument because every business has different profit margins, is subjected to different external gov't costs, and employs people with different backgrounds (college, trade, union, semi-skilled, unskilled) to accomplish their business goals.

My own example: I work 9 - 5 (okay, 8 - 7) in engineering consulting. The typical engineer I work with has an advanced degree, as to many of the scientists. We get good benefits from our company and in the scheme of things, if I don't compare myself with my neighbors in the FIRE economy who otherwise are troubled by the task of extracating themselves from a paper bag, I think I make a fair wage.


From 7 - 9, and on weekends and days off when needed, I run a business, and am the co-owner. Why? To afford to put my kids through college.


The business provides personal health care services, and many of our clients get reimbursed by the state, ie, the state sets the rates we charge and indirectly, the limit of what we can afford to pay our employees.


An important externality in any of these discussions is not just, "the going rate", the market price, etc.


Our gov’t also buys a lot of the products and services in our economy – it is either reflecting the market when it decides a price it will contract for, or setting the market price when it settles on a price that isn't really out in the market (and doesn’t update it frequently enough to keep up with inflation). I hope that doesn’t sound too convoluted – my point is it is either contributing the setting a price or perhaps holding increases in wages back.


I’m also stating this because there’s plenty of people in this country that make their living off the government, whether they see it that way or not. Lot's of fiscal conservatives included;)


On top of that, gov’t imposed externalities affect many businesses in this country beyond minimum wage, such as permits, regulatory compliance (especially manufacturing) that are other major drivers sending jobs overseas. Simplistically arguing about “a living wage” vs. “competing with the underpaid overseas” just isn’t looking at the full picture. I’m sure $10/hour would go a lot further under different political/gov’t/societal conditions (say, those, or about 100 years ago in this country).


As I was saying, for our employees that are primarily getting paid through gov’t services, we can’t afford to pay them a penny more unless I go home to my kid's piggy bank and break it open and hand over that extra money I’ve got, but that would only last about one week for about 2 or 3 employees.


Our employees are semi-skilled. We pay them about $1.75 above the minimum wage, less so above that wage as the minimum wage is slowly increased (ie, the average employee makes about $9/hr). We pay the market rate. These employees could not perform services in other industries, both for their personal needs (they want to work part time due to family obligations) and other personal limitations (education, language).


The service business is a very dangerous place to be while congress is looking to “fix” the economy, “fix” healthcare, “fix” things so they are “fair”. Our annual revenue is high but we're basically processing money in, paying for overhead, but most of it goes right out the doors as wages. Talk about a >$500,000/year business that can't afford to support any more gov't fixes!

My business partner and I probably make about $15/hour each before taxes for our efforts….a lot less than I make at my full time job. That’s the risk an owner takes when they start a business….to build a system that ultimately allows them to leverage their efforts to hopefully do better than that.


If business conditions change (forced unionization of the unskilled/semi-skilled employees of any service business that gets paid through gov’t contracts) due to policy change, then, like any business, we will re-evaluate whether we can continue as a business entity in a profitable manner, or whether we must just close our doors, and say, thanks for the memories!

I guess my point of weighing in on this discussion is that there are many factors that drive what a business owner is willing/able to pay, and they are beyond what a person on the outside (outside that industry) immediately understands/knows.

I hope that wasn’t too rambling. End of a long week with a long road ahead; our engineering consulting clients want twice the work for the same pay relative to 5 years ago.

PS - I pity the taxpayer that will have to pay increase taxes if we go out of business - I guarantee that it would take 3 gov't employees paid 2.5X what we're making to manage the services we provide at the quality we provide it. And that's just for the gov't employees that actually work, probably need to hire 2 or 3 more just to show up and collect a paycheck for doing nothing.

[flintlock]

Re: Jobless Rate: The Truth Bubble?

Thanks for sharing this wayiwalk. I like to read REAL WORLD experiences after wading through so much of the theoretical on this forum. I think what you are saying is that at some point your business will not be worth the effort. You are, after all, motivated by a profit. In your case the government indirectly sets the prevailing wage by only paying so much for your services. There simply is no more wiggle room to pay more. A lot of people fail to realize just how much impact government spending now has on the economy. Like with health care, we really don't have a distinct private sector economy anymore. Government's impact is just too large now to ignore.

[Raz]

Re: Jobless Rate: The Truth Bubble?

Ok, I'll be a little bit nice and ask for a do-over. I liked the way your argument started but it went off course around the point that you equated $8.25 an hour with my draft animal reference and after that you just rambled..

Lucky me. I'm underwhelmed by your kindness. I guess that means you won't tell me to "find a psychologist or join AA", or you'll limit the profanity to areas other than the marital status of my parents.

I didn't pull the $8.25 out of thin air - it's $1.00 above the current minimum wage. I've owned and operated four businesses during my 57 years on the earth and never paid minimum wage to any employee - not even the part-timers I had at the tunnel wash I owned.

I'm sorry if clear, reasoned concatenated sentences cause you difficulty. I fail to see the "rambling" you speak of.

I'm a business person. I run a business that pays all of our employees a salary on which I would expect to live and prosper. I completely disrespect your position and I suspect you have never run a successful business.

Congratulations, business person. But if you're half as arrogant, condescending, insulting and rude with them as you've been with me, then whatever you pay them isn't enough.

You'd need a Nanometer to measure how little respect I have for you.
You "suspect" I've never run a successful business? :rolleyes: You're a real piece of work.

After graduating college I managed a cash grain farm for my parents back in the 1970s. We were profitable 7 of the 8 years I ran the business. It was during this time that I began studying Technical Analysis and Business Cycle Theory. I talked them into selling the land to the largest life insurer in the US within six months of the peak of farmland prices in 1980 - six years later we could have bought it all back for half of what they paid.

After a four-year stint as a stock and futures broker with a major Wall Street firm I went into a financial service business with another broker. With 75 hour work weeks we turned a $65,000 investment into almost $600,000 in less than eight years, selling that business to a Kansas City company for cash. Along the way we bought, operated and paid for three car washes, selling them for cash in 2005.
We also managed to start from scratch a specialty food company that we still own. It has sales of over three million per year. Along the way I managed to save well over a million dollars. But "I suspect" all of this makes me a loser since I'm not a CalTech graduate with an ego the size of North America.

That you and others on this site are making the argument that US employees should work for wages as they exist in 3rd world countries disgusts me.

Would you mind pointing out where I said they should?

Try to focus on the issue. You are saying that the 'market' dictates the value of service and there should be no regulation to enforce a minimal standard. Humans as draft animals. If I've got that wrong, make a logical argument but don't ignore your previous posts on this thread.

You mean previous posts - on this thread - like this one?

With all due respect, Chris, I haven't lost sight of anything.

Nor are we defending low wages. The United States economy didn't instantly evolve from a mostly rural, agricultural economy of low wages (or no wages) into a massive, prosperous industrial giant. It took many decades and during much of that transition there were no minimum wage laws, health and safety regulators, pensions or anything else for the workers. Sharky only pointed out that the factory workers in China were far more prosperous than those who live in the rural countryside and make up the overwhelming majority of the present population.

The propellor driven aircraft came before the jet engine. Everyone must learn to walk before they can run. That's really all I intended to point out, certainly not that minimum wage Chinese workers staying in that position for the rest of their lives is a good thing. And our refusal to buy their products because their employers don't immediately raise their wages would only retard the process of growth for them and their country as well.

http://itulip.com/forums/showthread....423#post151423