Reich: Stocks Boom Off Low Wages

Sunday, March 17, 2013

Robert Reich: Joblessness all but eliminates the bargaining power of most workers -- allowing corporations to keep wages low. Public policies that might otherwise reduce unemployment -- a new WPA or CCC to hire the long-term unemployed, major investments in the nation's crumbling infrastructure -- have been rejected in favor of austerity economics. This also means higher profits, at least in the short run. ... Corporate profits are claiming a larger share of national income than at any time in 60 years, while the portion of total income going to employees is near its lowest since 1966.

Posted by Tor at 05:33 PM | 57 COMMENTS | permalink | Comment on This Entry |

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Tor

Joined 2012/08/31
Visited 2013/05/23

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He's talking about the need to bring back the Works Progress Administration and the Civilian Conservation Corps. There are bills in congress to do just that and no reason why liberals and conservatives shouldn't call Congress demanding these programs be resurrected.

Comments

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I've got your tunnels right here.

en.wikipedia.org

#1 | Posted by Tor at 2013-03-16 10:28 PM | Reply | Flag:

...bring back the Works Progress Administration and the Civilian Conservation Corps.

I totally agree. We've got antiquated infrastructure throughout our nation and a high unemployment rate. A new WPA and/or CCC would solve a good portion of both problems.

#2 | Posted by CalifChris at 2013-03-17 12:50 PM | Reply | Flag:

Obama had 750 billion just for these shovel ready projects. What happened? Why did Obama have other priorities?

Where did the money go? Why isn't Obama held responsible?

#3 | Posted by DavetheWave at 2013-03-17 05:19 PM | Reply | Flag:

Obummer's constant BS is the only shovel-ready project..

#4 | Posted by Greatamerican at 2013-03-17 05:25 PM | Reply | Flag:

No one will show up to work for the CCC or WPA unless it is also coupled with a decrease in welfare benefits...even then, it will be challenging. There is work in this country for the unskilled - it just might not be in the geographic area or line of work they want. So far, they have not moved to fill the shortfall or of all types of jobs supporting fracking. People want a job, but it has to pay way more than welfare, not be too hard physically, not be too dirty, not make them move, and not drug test. Frankly, these people don't really want to work.

#5 | Posted by Jacque_Strap at 2013-03-17 05:39 PM | Reply | Flag:

Obama had 750 billion just for these shovel ready projects. What happened? Why did Obama have other priorities?

Where did the money go? Why isn't Obama held responsible?

#3 | Posted by DavetheWave

There was certainly some waste in the stimulus, but it's pretty disingenuous to blame Obama for all of it NOT going to infrastructure when about a third of the stimulus was appropriated to tax cuts, at the insistence of republicans.

www.recovery.gov

Why aren't you also asking those republicans why more of the stimulus didn't go to shovel ready projects?

#6 | Posted by Whatsleft at 2013-03-17 06:37 PM | Reply | Flag:

"No one will show up to work for the CCC or WPA unless it is also coupled with a decrease in welfare benefits."

Yup.

The CCC paid $30/month, plus food, board, medical, etc. That's about $450 in 2013 dollars. You get more from being on the dole, and can do so without contributing anything in return.

The CCC worked because it was a means of surviving. That's no longer a concern. Now the concern is being able to purchase the latest cell phone the minute it comes available. I'd love to see some modern iteration of the CCC, but unless you paid the works a hell of a lot more than $450/month (I'd say you would have to start at $2k a month, and even there you're not going to get much interest.

And welfare bennies are useful in procuring votes. A bought voter is a loyal voter.

#7 | Posted by madbomber at 2013-03-17 07:13 PM | Reply | Flag:

I'd love to see some modern iteration of the CCC, but unless you paid the works a hell of a lot more than $450/month (I'd say you would have to start at $2k a month, and even there you're not going to get much interest.
#7 | POSTED BY MADBOMBER

I would like to see it as a mandatory requirement for receiving any government money - only way you will get people to work. Rotting apples in Washington State, unharvested crops in Alabama, a ridiculous amount of jobs in fracking areas - if people really want to work, there are jobs. It is sad to say but people really don't want to work.

#8 | Posted by Jacque_Strap at 2013-03-17 07:27 PM | Reply | Flag:

#6 hogwash Obama hasn't taken responsibility for anything bad. He himself said he didn't know they weren't any such thing as shovel ready. The only reason the public bought in was the claim that it was for shovel ready.

To blame republicans, when the Ds had the exec, house, and Senate is quite a strech.

Obama can't pass a budget, but he can pass the buck!

#9 | Posted by DavetheWave at 2013-03-17 07:57 PM | Reply | Flag:

Government policies are preventing growth of the economy. Government spending did not end the Great Depression-the policies prolonged the depression and made it worse. WWII did end the depression. A hard way to end one.

#10 | Posted by Donald at 2013-03-17 08:18 PM | Reply | Flag:

The CCC paid $30/month, plus food, board, medical, etc. That's about $450 in 2013 dollars.

450 a month after food board medical etc? Heck I have a decent job now but I would consider that. It is a good month if I can sock away 450 after expenses.

If you seriously made the pay 450 after all those expenses were covered I think you might have more interest than you expect Mad. Sure there are some parasites that would rather live on the dole but 450 a month could get you lots of toys if it didn't have to go to staying fed, warm and dry.

#11 | Posted by TaoWarrior at 2013-03-17 08:28 PM | Reply | Flag:

Oh, another moron that doesn't understand the difference between a majority, and a filibuster proof majority.

If the republicans weren't so set on opposing everything Obama did, I'm quite sure the dems would have been happy to pass stimulus with far more infrastructure spending. Most of the tax cuts were added to the stimulus to attract enough repub support to pass it in the Senate.

Regardless, the vast majority of the stimulus money went into circulation. At its base definition an economy is the circulation of money. It could have been done more effectively if it had been a reasonably cooperative effort, but by that definition the stimulus did help our economy.

#12 | Posted by Whatsleft at 2013-03-17 08:36 PM | Reply | Flag:

WWII did end the depression.

#10 | Posted by Donald

WWII was a massive stimulus program. What was WWII but a massive program of government spending?

#13 | Posted by Whatsleft at 2013-03-17 08:45 PM | Reply | Flag:

What garbage, as the left reinvents history

#14 | Posted by DavetheWave at 2013-03-17 08:48 PM | Reply | Flag:

Complete and total bunk. Nothing bad happens because I Ds by your defintion. QE is the only reason the markets are up. You can't explain what it is , why we need so much of it nor when it will stop.

Except, of course, till you blame Ts for everything bad.

Have you ever seen a potus pass the buck more then Barack Hussein Obama?

#15 | Posted by DavetheWave at 2013-03-17 08:53 PM | Reply | Flag:

Btw major correction tomorrow

#16 | Posted by DavetheWave at 2013-03-17 08:54 PM | Reply | Flag:

Btw major correction tomorrow

#16 | Posted by DavetheWave at 2013-03-17 08:54 PM | Reply |

Most likely correct---dow futures down 120 points and gold up $11.00---only the beginning. You can only manipulate markets so long until they bite you in the rear. The move tonight has to do with Cyprus which is a harbinger of things to come.

#17 | Posted by matsop at 2013-03-17 09:00 PM | Reply | Flag:

Have you ever seen a potus pass the buck more then Barack Hussein Obama?

#15 | Posted by DavetheWave at 2013-03-17 08:53 PM | Reply

How about trillions of "bucks"? He's a puppet established by the establishment/banksters and supported by the MSM.

#18 | Posted by matsop at 2013-03-17 09:01 PM | Reply | Flag:

Many people here don't know what they're talking about.

Most of the boys in the last CCC didn't have to join for food, social services provided enough of that even back then.

Most of them joined because they wanted to work, wanted to be trained, and wanted to be more than they were.

#19 | Posted by Tor at 2013-03-17 09:07 PM | Reply | Flag:

Most of them joined because they wanted to work, wanted to be trained, and wanted to be more than they were.

#19 | Posted by Tor at 2013-03-17 09:07 PM | Reply

The key word is "wanted"---I wonder if we have that mentality in this country any longer.

#20 | Posted by matsop at 2013-03-17 09:15 PM | Reply | Flag:

WWII was a massive stimulus program. What was WWII but a massive program of government spending?

#13 | Posted by Whatsleft at 2013-03-17 08:45 PM | Reply

When you look at the data, the economy may have been rebounding (slowly) prior to WWII. In fact, it may have begun with the repricing of gold.

#21 | Posted by matsop at 2013-03-17 09:17 PM | Reply | Flag:

While Reich is right, as usual, QE1, QE2 & QE3 are another relevant factor. Still labor cost is huge.

#22 | Posted by nutcase at 2013-03-17 10:15 PM | Reply | Flag:

"If you seriously made the pay 450 after all those expenses were covered I think you might have more interest than you expect Mad. Sure there are some parasites that would rather live on the dole but 450 a month could get you lots of toys if it didn't have to go to staying fed, warm and dry."

Of that thirty dollars, $25 had to be sent home to the worker's family.

The CCC covered necessities. $450 doesn't go far when one considers the cost of a new iphone and unlimited data plan, or the cost of a new X Box game. Furthermore, as has already been pointed out here, if you want to work there are already jobs out there. I think there may be some limited appeal to young adults that want to take some time off before going to college, kind of like the military, but unfortunately I don't see it generating a lot of interest.

As Jaque alluded to earlier, our system of public benefits should be set up like the CCC, where program participants had some obligation to the community. Clean up parks, pick up garbage, that sort of thing.

#23 | Posted by madbomber at 2013-03-17 10:15 PM | Reply | Flag:

"WWII was a massive stimulus program. What was WWII but a massive program of government spending?"

Stimulus in what way? It stimulated the economy, but the difference is in how it was funded. WWII cost $345 billion dollars. Americans provided about $185 billion of that through the purchase of war bonds. Stimulus money, on the other hand, is borrowed primarily from sources outside the US.

Maybe the US needs to issue stimulus bonds?

#24 | Posted by madbomber at 2013-03-17 10:20 PM | Reply | Flag:

The time honored answer for getting us out of the depression was WWII. Most economists since have viewed that as a simplistic answer----The economy was already improving since 1933 and then went into another deflationary spiral for about 27 months in 1937 but then through a normal endogenous propagation mechanism was reverting toward trendline again before the beginning of the war. Economists like to be able to explain everything in nice little theorems/models but more often then not economies go through cycles that if left to market forces heal themselves. It's when governments start to try to manipulate recovery that you often have the law of unintended consequences only reinforcing economic downturns.

#25 | Posted by matsop at 2013-03-17 10:32 PM | Reply | Flag:

$450 doesn't go far when one considers the cost of a new iphone and unlimited data plan, or the cost of a new X Box game. Furthermore, as has already been pointed out here, if you want to work there are already jobs out there. I think there may be some limited appeal to young adults that want to take some time off before going to college, kind of like the military, but unfortunately I don't see it generating a lot of interest.
As Jaque alluded to earlier, our system of public benefits should be set up like the CCC, where program participants had some obligation to the community. Clean up parks, pick up garbage, that sort of thing.
#23 | POSTED BY MADBOMBER AT 2013-03-17 10:15 PM | REPLY | FLAG

Last I checked XBox games were only 60 bucks for the brand spanking new ones, and unlimited data plans cost about 70.

When you don't have to worry about food, shelter, or medical care, $450 is a LOT of money. How insanely rich are you to not know that? You are a seriously spoiled brat, you know that? Why don't you just go ahead and say "_I_ wouldn't do it for less than complete leech status and 2K a month!"

Meanwhile, those of us who are poor? We'd love it.

#26 | Posted by soheifox at 2013-03-17 10:42 PM | Reply | Flag:

"Meanwhile, those of us who are poor? We'd love it."

Would you love it more than getting even more money for doing nothing?

#27 | Posted by madbomber at 2013-03-17 11:12 PM | Reply | Flag:

And if you're truly poor, and don't want to be, you might wanna try doing something different. Clearly whatever you are doing right now is not working. We still have a lot of jobs available in the Dakotas, relating to oil. And those jobs pay very well. You could also go to college or learn a trade. It's not there is a shortage of opportunities out there.

#28 | Posted by madbomber at 2013-03-17 11:14 PM | Reply | Flag:

"The key word is "wanted"---I wonder if we have that mentality in this country any longer."

After 9/11 teens joined the military and volunteered to serve in Afghanistan.

We are still that great country.

We need to give teens a chance to have that feeling that comes from accomplishment in labor.

#29 | Posted by Tor at 2013-03-17 11:38 PM | Reply | Flag:

that should read "respectable" labor.

#30 | Posted by Tor at 2013-03-18 12:28 AM | Reply | Flag:

#6 hogwash Obama hasn't taken responsibility for anything bad.

What fantasy land do you live in where any politician takes responsibility for anything bad?

Hell, most schmucks with an R after their name are still willing to defend the millstone we wore around our neck for a decade called the Iraq War.

#31 | Posted by jpw at 2013-03-18 01:30 AM | Reply | Flag:

WWII was a massive stimulus program. What was WWII but a massive program of government spending?

The start of perpetual military expenditure grossly over-weighted relative to the rest of the world and our own budget that is now an elephant on our back that is too sacred a cow to too many to do anything about?

Ironic, no?

#32 | Posted by jpw at 2013-03-18 01:32 AM | Reply | Flag:

stocks booming off free money electronically created by Fed, distributed to LARGE financial institutions who are NOT LENDING IT, just investing it for profit while timing the next stock bubble...

they are making billions, however if they get burnt, they'll get bailed out (again)

#33 | Posted by roadrunner22 at 2013-03-18 06:01 AM | Reply | Flag:

"The economy was already improving since 1933 and then went into another deflationary spiral for about 27 months in 1937 but then through a normal endogenous propagation mechanism was reverting toward trendline again before the beginning of the war."

New rewrite of history, how refreshing. Now you take the truth about the economic improvement which came with the New Deal and pretend it was just the economic cycle and that they economic cycle accounts for the full employment which WWII necessitated. Hilarious.

#34 | Posted by danni at 2013-03-18 06:52 AM | Reply | Flag:

Well now that that's over with, did you really think that it was going somewhere ?
And your foundation for its continuance was what ?

Pump and Dump over and over and over, but the left keeps telling you that its getting better because they have to tell you that, its all they have.
Plus the fact that drones want to believe, facts are not necessary.

Its not getting better its getting worse by the minute.
In Cypress today the Govt. but a 6.5 % TAX on ALL bank accounts.
10 % for those over One Hundred Thousand Euros....coming to a bank near you.

#35 | Posted by MENSAKOOK at 2013-03-18 07:03 AM | Reply | Flag:

#34 | Posted by danni at 2013-03-18 06:52 AM | Reply

Your posts just reveal the propaganda you want to believe. Most economists in looking over data in retrospect would accept what I just posted. They would laugh at your mindnumbing statement that reflects if people are lied to often enough they'll believe just about anything. The New Deal if anything retarded recovery.

#36 | Posted by matsop at 2013-03-18 07:16 AM | Reply | Flag:

"Your posts just reveal the propaganda you want to believe. Most economists in looking over data in retrospect would accept what I just posted."

They would accept the bare facts just not you explanation for them. They would credit New Deal programs for reducing unemployment every single year except, as you say, 1937 when Roosevelt listened to those who were more concerned with balancing the budget than reducing unemployment and cut spending. Then along came WWII, and every economist I have ever heard of, says it most definitely did create zero unemployment paid for with huge borrowing, the highest in our history, as a percentage of GDP higher than today. Pretending it was just the business cycle is ridiculous. The largest war in the history of the world is not just an incidental detail less important than the business cycle. It disrupted all business cycles on the planet. It changed the world so dramatically that a new cycle developed after that war totally unrelated to any before it.

#37 | Posted by danni at 2013-03-18 07:21 AM | Reply | Flag:

They would credit New Deal programs for reducing unemployment every single year except, as you say, 1937 when Roosevelt listened to those who were more concerned with balancing the budget than reducing unemployment and cut spending....

#37 | Posted by danni

you could SHUT your critics up quickly if ya simply put up all your assets as collateral to DEMONSTRATE your econ-expertise
borrow to the hilt, then hire friends & fam at top wages and benefits
THEY then can borrow and hire their friends also at top wages & bennies

voila! Your growing group should soon be booming with untold wealth
-- you could then hire a butler to post on DR for you

#38 | Posted by roadrunner22 at 2013-03-18 07:45 AM | Reply | Flag:

eh.net

Here, Danni, do a little reading. I'll give you some other info in the future to expand your knowledge (if your mind isn't too rigid). The New Deal did squat for recovery; the major event was the repricing of gold,increase in gold inflows and expansion of the monetary stock it accomplished. Why do you think sovereigns and banks all over the globe are buying gold currently. Why do you think America overthrew Gaddafi-----here's a secret; it wasn't for humanitarian reasons either. Try control of oil distribution and the stealing of the people's gold (about 140 tons) now sitting in the bank vaults in London. World War II was just frosting on the cake of an economy that was increasing in productivity and worker's salaries that were accelerating.

#39 | Posted by matsop at 2013-03-18 07:46 AM | Reply | Flag:

Truth is Danni hates for profit businesses. She can't name ONE of the fortune 500 she respects!

Arguing economics with a socialist is futile.

#40 | Posted by DavetheWave at 2013-03-18 07:52 AM | Reply | Flag:

"The New Deal did squat for recovery;"

Yeah sure, giving millions of people jobs did nothing. You can try to rewrite history but too many economists and historians have gone before you leaving us facts to depend on.

"you could SHUT your critics up quickly"

The boobs who are my critics are no worry for me I assure you. The things I predicted happened, the things they predicted did not. Mr. Matsop, above, is one in particular who predicted a recession which did not occur. Quite the opposite.

#41 | Posted by danni at 2013-03-18 08:00 AM | Reply | Flag:

Also, I don't pretend to be an economist, I only claim to be able to follow economists and notice which ones are proven right the most often.

#42 | Posted by danni at 2013-03-18 08:01 AM | Reply | Flag:

If you want a new CCC you have to call your congressman and tell them that they need to support H.R. 188

#43 | Posted by Tor at 2013-03-18 12:06 PM | Reply | Flag:

If you want a new CCC you have to call your congressman and tell them that they need to support H.R. 188

#43 | Posted by Tor

I think it's a great idea. Unfortunately, it's not likely to ever get passed by this congress.

#44 | Posted by Whatsleft at 2013-03-18 12:23 PM | Reply | Flag:

I suspect that Republicans purposely do not want to fund infrastructure repair because at some point they can give it away to private investors who will repair it and then operate our bridges, etc. at a profit.

#45 | Posted by danni at 2013-03-18 12:33 PM | Reply | Flag:

#45

Privately owned construction companies build and perform major renovation for highways already.

#46 | Posted by eberly at 2013-03-18 12:37 PM | Reply | Flag:

#46

I think she's saying that free-marketeers would like to turn them all to toll bridges and toll roads.

#47 | Posted by Whatsleft at 2013-03-18 01:23 PM | Reply | Flag:

I think she's saying that free-marketeers would like to turn them all to toll bridges and toll roads.

#47 | POSTED BY WHATSLEFT

This is a good idea.... pay the true cost of things.....

Of course our taxes wouldn't go down.... nope gas tax in Cali goes to a general fund.

#48 | Posted by AndreaMackris at 2013-03-18 01:39 PM | Reply | Flag:

"I think it's a great idea. Unfortunately, it's not likely to ever get passed by this congress."

All it needs is to get enough attention via the net and congressmen that say NBC reports it once and those that need it to pass will force Congress to pass it.

#49 | Posted by Tor at 2013-03-18 01:43 PM | Reply | Flag:

Of course our taxes wouldn't go down..

Nor will the toll go away. I remember when the Dallas North Tollroad was built in the late '60s or early '70s, between downtown and LBJ freeway, the 25c toll was supposed to go away in ten or so years when the road was paid for.

It's still a tollroad, and that same stretch costs $1 (last time I was on it -- could be more nown) to ride.

#50 | Posted by goatman at 2013-03-18 01:53 PM | Reply | Flag:

This is a good idea.... pay the true cost of things.....

#48 | Posted by AndreaMackris

It's a terrible idea. It would be a logistical nightmare to collect tolls for every individual piece of infrastructure.

#51 | Posted by Whatsleft at 2013-03-18 02:55 PM | Reply | Flag:

Hell, most schmucks with an R after their name are still willing to defend the millstone we wore around our neck for a decade called the Iraq War.

#31 | Posted by jpw at 2013-03-18 01:30 AM

Many wear it as a badge of honor, and you don't see Dave all torn up about that.

#52 | Posted by LIVE_OR_DIE at 2013-03-18 03:00 PM | Reply | Flag:

This program will save America money by virtue of a drop in the crime and social services rates.+

#53 | Posted by Tor at 2013-03-18 07:41 PM | Reply | Flag:

#5 | Posted by Jacque_Strap

You are on a roll, Jacque...

#54 | Posted by boaz at 2013-03-19 11:29 AM | Reply | Flag:

Every person here has enjoyed the fruits of the CCC's labor.

#55 | Posted by Tor at 2013-03-19 04:08 PM | Reply | Flag:

It's a terrible idea. It would be a logistical nightmare to collect tolls for every individual piece of infrastructure.

#51 | Posted by Whatsleft

The more time I spend on the DR the more I come to the conclusion that the "conservatives" do not understand the concept of "nation". They confuse it with "corporation" or "business". They assert that the priorities of a nation should be the same as those of a business, when clearly they are not. In their ideal world capitalism would always rule over democracy, but capitalism has no loyalties except to the bottom line. A nation's bottom line is it's people, not it's corporate profits.

#56 | Posted by WhoDaMan at 2013-03-19 05:11 PM | Reply | Flag:

A nation exists for the mutual benefit of ALL who live in it.

A CCC could greatly improve the common wealth we have in America.

www.youtube.com

#57 | Posted by Tor at 2013-03-19 06:05 PM | Reply | Flag: