May 11, 2016 6:27 AM
Morning Reads for When Only the Best Will Do (AKA: May 11, 2016)
Oh and it’s Wednesday so Ed is doing the MRs so the best was already assured.
“I Do Adore Her” Harry Belafonte
- David Perdue: “No question” our debt levels undermine national security; debt seeming the be-all-end-all of U.S. foreign policy.
- Jimmy Carter’s philosophy behind his energy policy should be adopted by Clinton.
- Cherokee Tribune & Ledger-News endorses Johnny Isakson for reelection.
- You know the old saw: As goes Canton, so goes–uh… some other larger part of Georgia?
- GA GOP hopefuls seem to be getting behind Trump; enthusiasm levels unknown.
- Atlanta had an 867% increase in the number of high-end rental properties from 2012-15.
- The absurdly skyrocketing housing prices in Atlanta don’t seem to be good for anyone.
- City of Milton wants feedback on comprehensive transportation plan.
- 81-year-old graduates from GSU.
- America’s greatest laureate (and my boy) Justin Bieber got a tat. On his face.
- Pride of Georgia arrested after 48 years on the lam.
- Pro tip: if you are a criminal on the run from the authorities, maybe don’t tell the authorities where you are.
- Good thing Alvarez was so eager to lose to GGG.
- Jessa Crispin doubles down on being a loon, says Paris Review can’t be called boring (mainly because it isn’t boring, not because you’d be violating some mores of the literary world).
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The two issues making this race tighten. The exit polls last night in WV close to 70 percent of voters think trade deals have hurt wages and jobs. American want a focus on our country,
………Americans are adopting a foreign policy much closer to Republican Donald Trump than Democrat Hillary Rodham Clinton, saying in a new survey that they want an “America First” focus that fixes the U.S. before other countries.
A comprehensive new Pew Research Center poll found that 57 percent agree that America should deal with its own problems. Just 37 percent disagreed. And more than not said America is too helpful internationally.
“The new survey, conducted April 12 to 19 among 2,008 U.S. adults, finds the public remains wary of global involvement,” said Pew. ……….
………”“The reality,” Jacobs said, “is production jobs increasingly resemble fast-food jobs or Walmart jobs.”
Wade’s reality is, she’s frustrated. She says her job is an improvement from Family Dollar, but the added pay has also reduced her government food payments. She lives with her children in public housing. She would like to earn more to help her kids, she said — and she would also like people to stop stigmatizing folks who accept government help to get through.”……….
https://www.washingtonpost.com/news/wonk/wp/2016/05/10/the-staggering-number-of-people-with-good-factory-jobs-who-still-need-government-help/?postshare=3081462885458682&tid=ss_tw
Very interesting. A 47% Georgia family participation rate in social programs for production occupations is a big problem. Particularly considering their employers get some of our choicest tax incentives.
Raising min wage to $15 without some trade offs, like import tariffs, will drive imports and probably see a cry to raise benchmarks for assistance.
How we find balance is critical and concerning if China’s top agents, the Clintons, gain control.
Salt,
I agree if we raise wages above the poverty rate, we need a trade off. One I suggested is we rebate back to tax payers, savings in welfare.
Anyway those are mostly Fed subsidies and state tax breaks for local jobs, we are #2 for OPM…..
Interesting article, John. My first thought is these low-wage, temporary employment solutions are the price of creating artificial circumstances to keep those jobs here. Trade policy is important here, but seems like a secondary issue to other factors such as government regulations and corporations being less moral and less connected to their employees than they used to be. But it is easier to tell a lot of people that we need tariffs and stuff.
The main driver is cheap disposable labor, outsourcing to visa workers or overseas workers is driving wages down, and creating less demand. The father of free market economics Adam Smith warned that if labor does not have equal rights to employers, it would create a distribution problem ie massive spread between rich and poor. Money does not move efficiently if it is concentrated at the top, ie rich people can only spend so much.
Below is a classic example why so many Americans are pissed.
…….Technology giant Intel announced April 19 it will fire 12,000 skilled U.S.-based professionals — after already swelling its workforce with 14,523 requests in Washington D.C. since 2010 for visas to import foreign professionals through the controversial H-1B and Green Card programs…….
……..There’s no shortage of U.S. engineers looking for jobs at Intel.
The U.S. marketplace includes many Americans — often older and experienced, but who ask for higher wages to pay for their families — who are eager to work at Intel’s outsourced jobs. For example, on April 21, Indeed.com offered resumes of 16,576 people seeking jobs as electronics engineers in Santa Clara, Calif., the company’s home town. They included Robert Hill of Cupertino, Calif., Ray Chen in San Mateo, Calif., and Aubrey Calder in Mountain View., Calif.
Nationwide, companies and universities employ roughly 800,000 lower salary white collar guest workers. That total is roughly equivalent to the number of Americans who graduate each year with degrees in business, medicine, technology, computers, and architecture. The resident population of white collar guest-workers includes roughly 100,000 lower wage professors, doctors, scientist and other professionals employed by U.S. universities and their affiliated business partners. These guest-workers help lower first-year salaries for American graduates, so lowering the Americans’ lifetime earnings.
The H-1B visa program isn’t the only program used to import foreign workers into the country. Late last year the Obama administration expended the Optional Practical Training (OPT) visa program, which is allowing 120,000 foreign students to work with companies, many of whom rely on the universities for hires………
…….Currently, four million Americans turn 18 each year, and the nation’s government annually imports roughly one million new legal immigrants and workers, plus hundreds of thousands of illegal immigrants and roughly 700,000 temporary guest workers, including the six-year H-1B professionals. In 2013, the inflow of foreign labor helped reduce wages and boosted the stock market……..
http://www.breitbart.com/big-government/2016/04/21/intel-lays-off-12k-looking-import-11600-foreign-workers-since-2010/
Yeah but… educated professionals in this country are not the ones who are working full time jobs and still requiring food stamps. The unemployment rate is much lower for those of us in technology than for everyone else, and it pays well. I think the issue with the H-1B program is that it highlights the poor state of our public education. It’s not an example of cheap labor flooding the market. In fact sponsorship is expensive and a pain in the ass.
Obviously in all positions it is holding down wages via macro economic data. Or other wise real wages would of been rising since the policy started in the 70’s via trade deals, not going the other way. We would not have 80 percent of the population living check to check, not even including negative net worth via liabilities. In this case we clearly INTEL had the engineers needed, they just wanted to pay less, and have employees with less rights via being on a visa. I do not blame INTEL because that is how the game is set up via the trade agreements. The incentive in the deals is to find the cheapest source of labor to gain a competitive advantage. At the end that on a macro, it creates a race to the bottom with wages, and less money creates less buying ie less demand. As you can see, if it was working so well, China would not be building ghost cities to maintain GDP growth. They have the same issue, to much money concentrated in to few hands. As Adam Smith taught in Wealth of Nations this distribution not good for the economy.
You are making some good economic points, John, however, the 80% living paycheck to paycheck doesn’t prove people have an income problem. I would bet a good number of those have spending problems.
Some do have a spending problem, but that debt spending is driving GDP, without the spending, the GDP would be even less. And you saw what happen the last down turn once the credit got cut off, high unemployment, values down…..This is the same cycle China is in….just with ghost cities verse credit cards, student loans…..Which is why we will face a world wide correction. This was similar factors, I saw last time when I warned about the last correction.
The USA has a major advantages over the world with natural resources like energy, water, farm land…..we have the best mix in the world under one government. We are falling behind with infrastructure, and we used to be the worlds envy.
The focus after the next turn down, needs to be on leveraging our advantages, while living with rational growth not an economy driven by credit default swaps, driving irrational debt levels, cheap labor, artificial interest rates used as juice, out of control healthcare cost, entitlement train wreck, student loans for an education with no ROI…..
“The incentive in the deals is to find the cheapest source of labor to gain a competitive advantage.” That’s actually just the incentive in business itself and it exists irrespective of trade agreements. If we invested more in our people, in their education and their health, that would give American companies a competitive advantage simply by being located here and having access to our workforce. And we would be much more resilient against the negative side effects of trade agreements.
There could be and probably are multiple reasons for the paycheck to paycheck phenomenon including high costs of housing and crippling student loan debt which, again, points to the state of our public education. But again, to my original point, living paycheck to paycheck is a heck of a lot better than working full time and still requiring government assistance.
It also has a lot to do with corporations having to meet the demands of stock holders and to produce dividends. If you look at the overall 50 year trends, as dividends have increased, the pay rates of employees (and through automation, the number of employees) has decreased. Dividends become of more importance in some cases then share value as the involvement in 401 (k) increased. Also by having temporary employees you avoid some additional overhead, like additional workmen’s comp payments, workers liability, healthcare, and any retirement benefits.
Good point and the stress on dividends is due to artificially low interest rates. The positive side it creates investment, but the negative is money chasing deals creates bubbles, if you have credit default swap type investment products. It pushes investments into 50 to 1 type lending deals from traditional 10 to 1. Less people have in a deal, the less they are rational about the investment.
Just a small note on the article/research paper. The chart is based on people working 10+ hours/week for 27+ weeks/year. There is an aside that the overall numbers are similar for people working 35+ hours/week for 45+ weeks/year but they provide no further details at that employment level. I think the information would have been more relevant if they had chosen to publish data at the level that most people would consider closer to a regular work-week rather than for people working as few as 10 hours/week.
Absurdly skyrocketing prices have been pretty good to real estate investors who can maintain occupancy
IIRC occupancy rates have not been great but we’re also sacrificing so much of our city for anodyne, all-glass, luxury high-rise apartments.
There’s legitimate concern about what London, New York and other great cities have become over the last 15 years with their rush for development and continual pricing out of residents. I’m really not sure what Atlanta can offer if we become like Manhattan in that regard.
Isn’t that what cities leaders want, the best use for property taxes and state/federal subsidies for the less fortunate ? Not saying it is all bad, just sayin….
Catch 22, upgrading a city makes people feel safer which drives the economic opportunity. This creates a disruption period, but on the macro usually helps more people than it hurts. When the ratios get out of whack ie rent/mortgage payment to real wages, you have a correction, and it gets messy for awhile. Which we saw the last down turn. We are seeing a lot of repatriation of money being invested here from places like China, but that only last so long…..
Chet,
It is irrational exuberance, because wages are not keeping up with rental prices. This is just one more sign we are in a bubble.
Or is it income disparity ?
Yes, a main driver….80 percent of people being one or 2 checks away tells you we have a demand problem, and why GDP has been basically flat. If you take out, credit cards, student loans, car loans, housing loans…..that are way out of whack verse risk, we are at a negative GDP. The same concept with China, if you take out the ghost cities they are building, China is flat to negative GDP as well. This down turn will start in China more than likely, 50 percent of their debt is real estate, who knows how much of that is empty cities the size of Atlanta?
The Unreal, Eerie Emptiness of China’s ‘Ghost Cities’
http://www.wired.com/2016/02/kai-caemmerer-unborn-cities/
China is even losing it’s blue collar jobs…
http://www.npr.org/sections/parallels/2016/05/02/476460617/starbucks-and-steel-the-divergent-directions-of-chinas-economy
I have a Question… if China’s steel industry is imploding (which has been the case in the last 8 years) and steel jobs are decreasing, how exactly will the promises of Trump to bring steel jobs back to America real work? Additionally, most steel production is now automated, what use to take 50 men on average in the 80’s can now be done by 12. (que Allentown, by Billy Joel).
The reason industries are suffering is lack of demand. Why even Costco, Walmart…..are calling for higher minimum wage. What Henry Ford said years ago, his workers need to make enough to buy the products they produce. Because we are globalized, via trade deals it starts with re- negotiating deals that do not promote a race to the bottom with wages. As far as automation, if wages increase, than demand will go up ie buying power, and hopefully create other opportunities. I cannot answer for the Trump plan, not part of his team.
Possible Clinton Foundation charities fraud? Say it ain’t so…
https://www.yahoo.com/news/wall-street-whistleblower-drops-clinton-111341360.html
Why is it whenever I read this handle name I get an image of Noway wrapped up in a blue blanket sleeping under a pumpkin vine while sucking his thump with Sally staring vengefully down at him for falling a sleep on her and Snoopy hanging over him vulture like shaking his head…
‘Cause it would be a true image! I told yall a couple of months ago I’d be posting anything Clinton email related or Clinton controversy under this handle! I’m a true indictment believer! Hence the name!
So you really do suck your thumb… Not that there is anything wrong with that.
Snick…
You forgot to mention my hugging the blanket, too! I wanna get the entire Linus thing right!
I included the blue blanket… Read it again. ?
You know, I watch the Charlie Brown specials every year. The Great Pumpkin, obviously, but the Charlie Brown Christmas with Linus telling Charlie Brown the meaning of Christmas will literally bring a tear to one’s eye! 🙂
I have spoken with Noway directly before. He is a very accomplished professional, you would be surprised what he does for a living. His job takes tremendous discipline and intelligence. I never tell people names, that post here, unless they agree.
Thanks for those kind words, John. I enjoy Ellyn busting my a$$, though, as I have told her before!!
Only telling the truth…..You are very humble and thoughtful ….Why I respect you. agree or not, before I ever knew what you did, got a sense from your comments…..
I have an idea of what he does based on some of his comments relating to where he has been and his time spent in some well know govement like training area. I have respect for his knowledge on topics I have no clue or finite understanding. ( l have yet to find a fire arm I could fire that could safety hit a target smaller then a grain silo at 20 feet) I even asked him for advice on buying hardheaded gun and fishing survivalist nuts Christmas presents. (My brother now has a floater attachment on his leatherman so he wont lose it fishing).
That being said, he did use the words Great pumpkin in his Hillary fan cub handle. (I secretly think it’s code for his love of orange skin GOP members but I degrees). How can you not make peanut references… In February I believed I was going to turn him into a spiced latte.
Here’s the thing. If I didn’t respect a person I wouldn’t tease them.
Morning, El! Regarding your firearm comments, I work with a lot of interpreters, usually female and almost always ‘librul.’ LOL! Having said that, they are always a bit scared of the firearms when we are on the range. I had a group of Russian interpreters once that after we began the shooting exercises, the saw that it wasn’t that big a deal and they began bugging us to show them how to shoot at the lunch break! To a lady, they all loved shooting the Glock and within 15 minutes they were all acting like Calamity Jane. Picture Natasha on Bullwinkle! My point being, I’ll bet you could get a small .380 and be shooting confidently within an hour! Get that Bro of yours to take you to the range!!
It’s not the firing of a gun that’s the issue. I know how to fire and release the safeties on each of the guns I grow up with. I fired small and large handguns. I truly can not aim. My own brother believes every American, including paroled felons and the mentally ill, have the right to own guns – except for me. He called me a public safety hazard after I hit the light pole 20 feet to the right of a target, and the bullet (contrary to some laws of physics and math) ricted back and embedded in the side of one of his fishing slopes. Behind us. After dragging our butts off the ground where he threw us, he stated right there that he was never letting me near a gun in his presence again and locked up his Glock.
Awwww, that’s EZ to fix!!! Tell your bro to give you another chance! Trust me, if the Russian ladies could dial it in quickly, so can you!!!
The subconscious hear, see, speak no evil word is “Clinton”
Hey, I don’t make the stories. I happen to see them and The Pumpkin links them. She’s horrid.
Perdue is like a broken record, err I mean a skipping CD. Or a bad bluetooth connection.
Well…you gotta do what you gotta do to keep that cash coming from the Peterson Hydra. If they aren’t behind it he really is stupider than I imagined (and I’ve imagined him pretty stupid)