Workers Getting Screwed

[okaycuckoo]

I guess it's generally agreed that workers have been making up the slack in their income over the past ten years with debt and "property is my pension".

Barry Ritholz posts some eye watering graphs on what's actually been happening to workers in the US since the 1940s - nasty stuff:

http://www.ritholtz.com/blog/2011/08/the-heart-of-the-matter/

[okaycuckoo]

feel duty bound to add elizabeth warrens 'the coming collapse of the middle class' to this thread.

well worth the time for anyone who hasn't seen it.

http://www.youtube.c...elizabeth+warre

Haha! We're on the same page. I remember starting a HPC thread on that video about 3 years ago (or was it **** - the dead forum that shall not be named).

edit: I can't believe "*************" is still blanked! Doccyboy, some respect for the dead please.

edit 2: even when I spelled it with spaces between the letters, still blanked!

Edited August 26, 2011 by okaycuckoo

[Self Employed Youth]

Workers are screwed for working. They are paid in a depreciating currency. The wages available are often so low that you'd be better off signing on and working for your dole (better working conditions and a stable income compared to precarious work through an agency), after a while you could progress to a supervisory role for the likes of a4e and manage other workers forced out of working for a wage.

It's like serfdom. And it's an insult to the public and private sectors. It's a private sector layer of middle management introduced to the public sector, in order to boost the private sector employment figures.

The social safety net traps you, your priced out of doing productive work, you then can be forced to do a non job.

[Saving For a Space Ship]

[Charlie The Tramp Returns]

Application for a night shift replenishment ( shelf stacker )hourly worker.

I shall still be trying to secure employment for the person concerned, but after 5 months it is getting harder.

Example one well known Supermarket has emailed over 400 vacancies the past 5 months mainly 12 hour permanent contracts at £6-21p ph.No wonder people stay on Job seekers Allowance only £8 difference, pay you fares to the job and you are on equal parity with JS allowance.

**** ******,

Night Shift- South East

Thank you for taking the time to complete your application for a position within *********.

We regret to inform you that, on this occasion, you have not been successful.

The standard of application has been very high ( Desperate University Graduates applying? ) and it was only after much deliberation that we reached the decision that we will not be progressing with your application further.

We would like to take the opportunity to thank you for your time and for participating in our recruitment process.

Finally, we would like to express our sincerest thanks for your interest in working for ********* and take this opportunity to wish you all the best for the future.

Kind regards,

[beccles]

Application for a night shift replenishment ( shelf stacker )hourly worker.

I shall still be trying to secure employment for the person concerned, but after 5 months it is getting harder.

Example one well known Supermarket has emailed over 400 vacancies the past 5 months mainly 12 hour permanent contracts at £6-21p ph.No wonder people stay on Job seekers Allowance only £8 difference, pay you fares to the job and you are on equal parity with JS allowance.

Eh?

JSA = £42 pw?

say 48hrs @ £6.12 = £292?

?

[Charlie The Tramp Returns]

Eh?

JSA = £42 pw?

say 48hrs @ £6.12 = £292?

?

This person was getting £64 per week JS maybe it was his age or his situation.

Where do you get £292 from when I was at school 52 years ago we were brilliant at mental arithmetic 12x £6-21 = £74.-52 less reduced NI stamp.

[okaycuckoo]

This person was getting £64 per week JS maybe it was his age or his situation.

Where do you get £292 from when I was at school 52 years ago we were brilliant at mental arithmetic 12x £6-21 = £74.-52 less reduced NI stamp.

I dunno, but Beckie's avatar tells you where to get lost. Hehe!

[Self Employed Youth]

Eh?

JSA = £42 pw?

say 48hrs @ £6.12 = £292?

?

It's £54 a week for under 25s, and £67 for over 25s.

Then there is housing benefit and council tax benefit, there may be tax credits, dla etc. also.

[aa3]

Notice how wages relative to output fell off a cliff during the 1920's as well. In that era the farm combine and combustion engine really changed the game in so many ways. They responded the same way we did, with a huge debt bubble to make up the output gap.

Followed by a depression, like us. And the only way out was 'the New Deal'. And the New Deal worked, things were going good until about the year 2000, when the tech wreck happened. The New Deal allowed capitalism to work well for another 60 years!

As me and a few others have been predicting for awhile eventually we will need a second New Deal. You could be the best businessman with the best product, but if everyone is broke you are broke too.

[erranta]

Notice how wages relative to output fell off a cliff during the 1920's as well. In that era the farm combine and combustion engine really changed the game in so many ways. They responded the same way we did, with a huge debt bubble to make up the output gap.

Followed by a depression, like us. And the only way out was 'the New Deal'. And the New Deal worked, things were going good until about the year 2000, when the tech wreck happened. The New Deal allowed capitalism to work well for another 60 years!

As me and a few others have been predicting for awhile eventually we will need a second New Deal. You could be the best businessman with the best product, but if everyone is broke you are broke too.

The new Deal only worked for the Satanist scum with their spiral markets, devaluing of the pound and dollar to less than 1% of it's valuation in the era you mention, expansion of the monster Big Business bullying companies we are now lumbered with raping the Earth and blaming it on the general population

(just like they did with river pollution from their previous generation industry poisonous discharges)

We now get taxed on the air we breathe by the 'fast-buck' bruvverhoodies of AYR

Edited August 27, 2011 by erranta

[Georgia O'Keeffe]

Notice how wages relative to output fell off a cliff during the 1920's as well. In that era the farm combine and combustion engine really changed the game in so many ways. They responded the same way we did, with a huge debt bubble to make up the output gap.

Followed by a depression, like us. And the only way out was 'the New Deal'. And the New Deal worked, things were going good until about the year 2000, when the tech wreck happened. The New Deal allowed capitalism to work well for another 60 years!

As me and a few others have been predicting for awhile eventually we will need a second New Deal. You could be the best businessman with the best product, but if everyone is broke you are broke too.

Isee youve switched from talking guff about money printing to talking guff about the previous depression now the new deal like all other govt intervention most likely prolonged the depression through mis/fixed pricing and other misallocation, what worked was the same solution as every other credit collapse in history, savings reached such a level for the economy to blossom, as for your assertation it was all going fine until 2000, thats clearly nonsense, you may as well trumpet Labour and say it was all actually going superbly until 2007, Savings have been cratering for decades, this depression will end at the same point as all others, when there are enough savings rebuilt across the population.

As one of the charts above alludes to its been going pear shaped since the early 80s when workers wages (Reagan/thatcher bubbletricklenomicbollux) and thus savings started falling (subtlely hidden by understated inflation indices*, a pretty much direct transfer to govt and asset holders) replaced by credit debt (expanded mainly via mortgages hence why an incentive was given to take on mortgage debt via council property and various other tax advantage that debt carries causing behavioural change,)

*Leading to all those industries that thrive under mispriced inflation (govt,lawmaking and many assorted non jobs as a result of said laws and finance , mostly in short rentierism) thriving and those that are hurt by underpriced inflation cratering (manufacturing, engineering etc etc) by the time this depression/regression/recession whatever is over the economy just like the savings/debt ratio will have rebalanced,( both will be among the surest indicators that the economy is ready to genuinely grow ) and like all the others it will be despite everything that govt does to stop it happening.

Theres also many views that the war ended the depression and caused a boom which is highly debateable, of course what the war resulted in was huge levels of savings coz no fcker had anything to spend their wages on so again the direct cause was savings, whether a war is a necessity to grow the savings is a secondary point

Edited August 27, 2011 by Tamara De Lempicka

[OnlyMe]

Isee youve switched from talking guff about money printing to talking guff about the previous depression now the new deal like all other govt intervention most likely prolonged the depression through mis/fixed pricing and other misallocation, what worked was the same solution as every other credit collapse in history, savings reached such a level for the economy to blossom, as for your assertation it was all going fine until 2000, thats clearly nonsense, you may as well trumpet Labour and say it was all actually going superbly until 2007, Savings have been cratering for decades, this depression will end at the same point as all others, when there are enough savings rebuilt across the population.

As one of the charts above alludes to its been going pear shaped since the early 80s when workers wages (Reagan/thatcher bubbletricklenomicbollux) and thus savings started falling (subtlely hidden by understated inflation indices, a pretty much direct transfer to govt and asset holders) replaced by credit debt (expanded mainly via mortgages and various tax advantage that debt carries, hence why an incentive was given to take on mortgage debt via council property)

The other chart that are screams similrities with the effects of the 20's bubble is income distribution - the new deal would go naff all about that as well - it was only the act of the bubble collapsing and a more even income distribution that created the foundations for a widespred improve in employment and earnings conditions with more participants able to function in the economy - coming up with their own ideas, starting ther own businesses, creating employment, growth and new opportunities for others. The corporate stragnlehold and financial stranglehold exerted by have few holders of welath (or wealth locked up in non-productive activies / assets) is the real reason for the moribund state of new company formation - which is exacttly what the existing corporate cleptocracy want - they do not want new compeittion they want ever tighter strangleholds on their existing business areas and this breeds malaise in the wider economy.

We have a generation who will be even more indebted form an earlier age, lumbered with eother high rent or or insane mortgages for crappy little shit boxes with no resources to bring new companies to life and wedded to whatever reliable income they can secure to service their debt month on month with little to no chance of escape.

Looking very grim indeed for the future unless this is reset - every month/year that passes the outcome will be worse.

[Georgia O'Keeffe]

The other chart that are screams similrities with the effects of the 20's bubble is income distribution - the new deal would go naff all about that as well - it was only the act of the bubble collapsing and a more even income distribution that created the foundations for a widespred improve in employment and earnings conditions with more participants able to function in the economy - coming up with their own ideas, starting ther own businesses, creating employment, growth and new opportunities for others. The corporate stragnlehold and financial stranglehold exerted by have few holders of welath (or wealth locked up in non-productive activies / assets) is the real reason for the moribund state of new company formation - which is exacttly what the existing corporate cleptocracy want - they do not want new compeittion they want ever tighter strangleholds on their existing business areas and this breeds malaise in the wider economy.

We have a generation who will be even more indebted form an earlier age, lumbered with eother high rent or or insane mortgages for crappy little shit boxes with no resources to bring new companies to life and wedded to whatever reliable income they can secure to service their debt month on month with little to no chance of escape.

Looking very grim indeed for the future unless this is reset - every month/year that passes the outcome will be worse.

Well im not an Apocalypse now believer, for me its just a normal large degree credit cycle ending, and therefore i think the youth are quite well placed, anyone under the age of 25 should be fine if they have a good head on them because the majority of their working life will be spent during a credit growth cycle, i think the ones who are probably quite fcked are those in the 45 to 55 group as they will be retiring into a credit (and associated asset price collapse). It may well seem the opposite to this now but i cant see this particular cycle not resolving in the next 10 or so years which puts them in jeopardy as they wont have the time to benefit from a Real recovery. In the end like most things, something the boomer bashers on here dont understand its mostly down to luck/lack of luck and the accident of birthdate

Edited August 27, 2011 by Tamara De Lempicka

[okaycuckoo]

Theres also many views that the war ended the depression and caused a boom which is highly debateable, of course what the war resulted in was huge levels of savings coz no fcker had anything to spend their wages on so again the direct cause was savings, whether a war is a necessity to grow the savings is a secondary point

Martin Hutchinson has interesting views on this - he subtracts government spending from GDP to give gross private production figures:

The same applies to the well-known Keynesian thesis that World War II cured the U.S. Great Depression. World War II increased GDP, but more than 100% of the increase was devoted to munitions, building the Pentagon, employing teams of bureaucrats to control prices and government activity generally, much of it misguided. Gross Private Product decreased from $921 billion in 2005 dollars in 1940 to $427 billion in 1944, well below 1932’s level, showing that the private economy was badly squeezed. Then in 1946, while GDP decreased by 11%, GPP more than doubled to $1,309 billion. Readjustment was inflationary and disruptive, but it saw an astonishing increase in output and living standards.

http://www.prudentbear.com/index.php/thebearslairview?art_id=10567

[_w_]

Theres also many views that the war ended the depression and caused a boom which is highly debateable, of course what the war resulted in was huge levels of savings coz no fcker had anything to spend their wages on so again the direct cause was savings, whether a war is a necessity to grow the savings is a secondary point

I think it was savings + productive investment opportunities (resulting from the war).

Looking into this I've noticed three periods of interest that displayed clear overcapacity and scarcity of productive investment opportunities: the early 20th century, 1960s-70s and late 90s-00s. Each is of interest.

The 1900s-20s led to a change in business from selling to satisfy needs to selling to satisfy wants; the advertising and 'public relation' industries really came of age at that stage and enabled this change, assisted by the first explosion of consumer credit. This was one striking effort aimed at dealing with overcapacity and a dirt of productive investments opportunities for capital to get into.

The 1960s-70s showed the end of the post war reconstruction phase and explosion of consumer credit all over the western world, not just in the US. At the end of that period, again capital found insufficient investment opportunities. This led to GATT and the opening of new world markets.

The late 90s-00s was the end of the globalisation process from an investment perspective. By 2005 by my reckoning China was already experiencing serious over capacity in most industries. 5 years later China was in the business of building entire towns with no one to live in them. The end of this boom phase led to the unreal debt explosion starting in the late 90s that we witnessed everywhere.

I think there is a case to be made for looking at things from the perspective of a capital investment opportunities rather than from a savings perspective. Large savings with no reasonnably attractive investment opportunity woudn't improve things IMO, I think they just lead to more consumption and asset inflation or deflation if they are simply hoarded.

Edit to add:

I think one could say that at the end of these phases of over capacity there is an excess of savings and capital but they are not evenly balanced. Income and wealth inequalities mean that savings are highly concentrated and vast, always looking for a home. However, looked at with the lack of savings of the rest of the population (who are constantly brainwashed via advertising and PR to buy things they don't need) they result in a very low savings rate in aggregate.

Edited August 27, 2011 by _w_

[Georgia O'Keeffe]

I think there is a case to be made for looking at things from the perspective of a capital investment opportunities rather than from a savings perspective. Large savings with no reasonnably attractive investment opportunity woudn't improve things IMO, I think they just lead to more consumption and asset inflation or deflation if they are simply hoarded.

Edit to add:

I think one could say that at the end of these phases of over capacity there is an excess of savings and capital but they are not evenly balanced. Income and wealth inequalities mean that savings are highly concentrated and vast, always looking for a home. However, looked at with the lack of savings of the rest of the population (who are constantly brainwashed via advertising and PR to buy things they don't need) they result in a very low savings rate in aggregate.

,

Edited August 27, 2011 by Tamara De Lempicka

[_w_]

,

Don't pull your punches!

[aa3]

There is a reason there is always a credit bubble to go along with a decline in wages. What happens is a bunch of new technologies come in during a period that for one reason or another cause jobs to be lost faster than they are created. This causes the loss of good jobs and even if those people who lost the good jobs find more marginal jobs, there is obviously declining wages.

But because the technology is replacing htem, production is still there or even rising. However when all those goods are produced but the population as a whole has less spending power, the natural result is a deflation in the price of those goods. Firms lay off more people, less money is flowing around, we all know the deflationary spiral.

So the monetary authorities eventually pick this up with their basket of goods. And then move to lower interest rates. As they lower interest rates people who still are in the good jobs can bid much higher for things like houses. Once you get a sustained rise in an asset for a couple years, the speculation itself starts driving people into it. The hope for more equity gains.

[wonderpup]

savings are highly concentrated and vast, always looking for a home

I believe this pool of wealth and it's hunger for yield was what inspired the mutation of the derivatives market as the banksters began constructing ever more complex ways for this pool to be profitably 'invested'.

So we end with a vast casino that generates exponentially growing claims on real world wealth but does nothing to increase that wealth in terms of real world investments in production- which leads us to the great conundrum of our time- too many IOU's and not enough pie to meet them.

[Injin]

I believe this pool of wealth and it's hunger for yield was what inspired the mutation of the derivatives market as the banksters began constructing ever more complex ways for this pool to be profitably 'invested'.

So we end with a vast casino that generates exponentially growing claims on real world wealth but does nothing to increase that wealth in terms of real world investments in production- which leads us to the great conundrum of our time- too many IOU's and not enough pie to meet them.

From the PoV of the ruling class, claims for pie force the population to make said pie.

More claims = more production "output gap."

The fix is as simple as it is politically impossible, end the legal tender laws.

[_w_]

From the PoV of the ruling class, claims for pie force the population to make said pie.

More claims = more production "output gap."

The fix is as simple as it is politically impossible, end the legal tender laws.

Injin, was it you who said something along the lines of 'there is no such thing as value, only price'?

Edited August 27, 2011 by _w_

[Injin]

Injin, was it you who said something along the lines of 'there is no such thing as value, only price'?

Something like that yes.

Values are peoples opinions about things. Like all thoughts we can't know other peoples with any great certainty. All we can know are prices, because those are where two subjective opinions briefly meet to create something empirically measurable.

[_w_]

Something like that yes.

Values are peoples opinions about things. Like all thoughts we can't know other peoples with any great certainty. All we can know are prices, because those are where two subjective opinions briefly meet to create something empirically measurable.

Top stuff! It's taken me two years to begin to become aware of this.

My hat off to you.

[ska_mna]

a vast casino that generates exponentially growing claims on real world wealth but does nothing to increase that wealth in terms of real world investments in production

Like that, very succinct, thankyou. Very interested in the productive vs destructive industries debates just now.

And thanks Bob for the Fed for reposting the the Elizabeth Warren vid too, I hadn't seen it. Some great takeaways there.