There's a fundamental shortsightedness with using "UNemployment" as a metric of the state of our economy. And that's because the nature of "employment" itself has so radically changed in the U.S. over the past few decades.
What we should rather be focusing on is "UNDERemployment", which of course includes "UNemployment"
Here's the problem:
When you talk about "UNemployment" there's the obvious presumption that if you're not in that category, then you're "employed", with the further presumption that you're doing reasonably well financially - at least making ends meet.
But that's clearly not the case in our current economy. So many who are "employed" are actually "UNDERemployed" and not earning enough to make ends meet. Many are working two or more jobs and still not making ends meet. So being in the ostensibly reverse category of "employed", does not mean there's some balance between the two.
Of course, being "UNemployed" is worse (50% of something is better than 100% of nothing) and the more of us who are in that category - the bigger those numbers get - is certainly a chilling metric. But again, being "UNemployed" is, ipso facto, "UNDERemployed" as well.
The reason our economy is in collapse (in my humble opinion) and will continue to get worse, is "low wages". Americans, in large part, now don't have any money to buy anything but the most basic things for survival (many can't even manage that), and this includes an increasing percentage of those who are actually "employed".
We've seen a fundamental restructuring of our economy over the past 30 years; from "good paying jobs with benefits" for the masses, to "minimum wage jobs with no benefits" for the masses. This fundamental change in economic structure is why looking at things the old way is missing what's really going on. It's also the reason things aren't going to magically turn around. This is not some "cycle" that will inevitably swing back the other way. (wishful thinking)
What we're now facing are the consequences of a decades-long war on labor in this country which has eliminated a 'critical mass' of good paying, working class jobs - which once fueled the greatest economy on the planet. The domino effect has been utterly destructive, and we're really only just beginning to see that now.
The Titanic has already hit the iceberg, is taking on water, and will ultimately sink.
There's really no stopping that reality from occurring at this point.
A nation of "minimum wage" workers is what we've essentially become, and it's getting worse, not better. The powers that be continue to represent corporations who only look at next quarter profits and how to increase them by continuing to reduce labor costs. How can anything possibly change if we continue in this direction.
The irony, of course, is that big corporations in this country, enabled by our so-called representatives that they've bought off, fired their own customers.
For example: The big automakers were at the head of the line lobbying (bribing) our government to pass so called "Free Trade" laws so that they could fire well-compensated American workers and outsource their production to other countries in order to make higher profits. A few decades later, after the domino effect these trade deals started in our labor market has brought us to where we are today, they're all going bankrupt because nobody can afford to buy their cars anymore.
And it's not like many people didn't see that this would happen. Ross Perot famously debated Al Gore on the topic of NAFTA, and quite accurately predicted what would happen 20 years down the road when nobody could afford to buy those new cars anymore. But I digress.
Now you might argue this is overly simplistic, and in describing things in only a short paragraph or two, how can it not be, but often things are a lot more simple than people want them to be.
The fact is, American corporations got our government to change the rules so they could make higher profits, but at the expense of the American workforce. And not just "a" workforce, but a critical core of our workforce; the best paying, working class jobs we had in this country. The jobs that created the post-war, decades-long prosperity in this country that brought the "American Dream" to everyday folks across this country.
That is, until the 1970's when the war on labor began to gain ground again and "Real Wages", as tracked by U.S. Bureau of Labor Statistics, began a slow and steady decline to this day.
Good paying, working class jobs were the fuel of our economy. People had good jobs, that paid a living wage, and they could consume lots of goods and services. And the country prospered, again ironically, for the very corporations that then went on to slit their own throats long term in the interest of short term profits.
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People are all caught up these days in the illusion that our problems have been caused by evil Wall Street crooks, banks, credit card companies and mortgage brokers, etc., but that's so missing the point of what's really happened. That's scapegoating. All those things were actually consequences of falling wages.
As Real Wages began their slow fall during the 1970's, fewer and fewer people could qualify for credit under the older, saner, rules of good finance. Banks, credit card companies and mortgage brokers had to start loosening the rules in order to continue to sell people profitable credit.
"Sub Prime" mortgages were created, credit qualification rules were lessened, and people who previously would never have been able to buy things on credit were not only re-qualified to do so, but in many cases had fiscally dangerous, if not outright insane loans misrepresented and pushed on them.
You can blame people for buying houses they couldn't afford, but in the past the banks wouldn't let you do that. The banks changed the rules so that they could keep selling loans to people who now couldn't afford them - as wages were dropping in this country.
The banks, mortgage brokers and credit card companies were only responding to a changing market, by coming up with ways to continue to make money, and of course with no moral regard for the consequences of what they were doing.
You see, the banks, et al, aren't really to blame for our economic woes, they simply contributed to it after the fact of falling wages had already begun to take it's toll on this country.
And, of course, as the nature of the lending industry changed, where loans are promptly sold off to other interests, they couldn't care less if the customer ultimately defaulted. They'd no longer be holding the paper anyway. It would be someone else's problem.
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So coming back to the real meat of our problem, "UNDERemployment".
When Americans have money to spend they spend it on goods and services, the fuel of an economy. Obviously, Americans don't have that money to spend anymore, and there's only one reason for that; low wages.
You can't buy new cars and houses and big screen T.V.s and $100 sneakers without an income that supports that consumption.
Our economy has been fundamentally restructured over the past 30 years. Our workforce transformed from good paying jobs to minimum wage jobs. It's a completely different beast than before. So attempting to compare our current economic state using outdated metrics and perspectives that do not take these fundamental changes into account, is not only missing the point, but continuing to do more damage.
I keep wondering why nobody asks Obama the obvious question every time he - like Presidents before him have - tout "millions of new jobs". Okay, but will those jobs be "good paying" jobs, or more minimum wage jobs?
Because millions of new minimum wage jobs won't change a thing, because "UNemployment" is not the so much the real problem here, rather it's "UNDERemployment".
Even if, rather than handing out billions of taxpayer dollars to powerful corporations and other cronies, we gave that money to the people instead (obviously a better choice), the "stimulus" effect would be short-lived. As soon as people spent that money, which would temporarily jump-start the economy, we'd be right back where we are today. A country of people who can't find jobs which pay well enough to drive the economy.
It really isn't that complex when it comes right down to it. When people earn good paychecks, they spend them and the economy thrives.
When people don't earn good paychecks, well, we're seeing what happens right now.
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The only way things are going to possibly change in this country, is if we begin to rebuild a "good paying jobs" economy. And nobody is talking about that. Not our leaders, our representatives, or even "Nobel Prize Winning" economists, who apparently either don't get it, or are shills for the corporate ideology of reducing labor costs to the absolute minimum. An ideology which is fundamentally flawed because it's those laborers who are also your customers.
Our leaders, the powers that be, are not talking about doing anything to change this fundamental pillar of our once great economy (when people were making good money).
This whole "Stimulus" stuff will do little to nothing unless the jobs that are created are "good paying" jobs. And I've heard nobody say that they will be. Only that "millions of jobs will be created".
And again, unless those new jobs pay well, nothing will change and things will only actually get worse.
You want to stimulate the economy in a meaningful way? Triple the minimum wage tomorrow and you'll see the economy take off like a rocket.
And don't lecture me about the burden on business, because a slight increase in retail prices more than offsets a marginal increase in labor costs. It's better to have people who can afford to buy more expensive products, then people who can't even afford to by the cheap ones.
And we could easily help offset the burden on business through tax credits and other means that, short term, soften the transition.
But it wouldn't take long, with people starting to bring home decent paychecks, before spending would take off again and a domino effect - in the opposite direction - would start rebuilding our now broken economy.
There will be no "recovery" without an increase in wages.
This is not some regular "cycle" that will ultimately swing back in the other direction.
This is not the same economy we had in the past, and looking at it that way and comparing stats like "UNemployment" to past recessions is therefore of little value.
The problem is "UNDERemployment", not so much "UNemployment"