Posts Tagged ‘Alan Krueger’

The race to the bottom is more stark than ever before in the United States.

A new research paper by two eminently mainstream economists, Lawrence Katz and Alan Krueger, finally confirmed what has been clear to anyone who goes out to look for a job: Virtually all of the net jobs created in the past decade are “non-standard” — temp, part-time, contract work, or something other than a traditional job with a normal paycheck. This is the economic recovery, and this result strongly suggests that the next recession, which the nation is already on a crash course with, is going to be worse than the last one. Click the following link for Katz and Krueger’s research paper.



Katz and Krueger discovered that the number of Americans working in non-standard jobs increased by 9.4 million between 2005 and 2015 — or more than the total number of jobs created during is period.

Where did all the traditional jobs go? They’ve been exported to China, Vietnam, Pakistan, and other nations. Over thirty million have been exported since 1994. If those jobs had remained in the United States, this economy would be humming, and wages would be going up. The stock market bubbles wouldn’t exist because the difference between the old higher US pay and the new lower foreign pay goes straight into rising corporate profits, surging dividends, and explosive stock growth.

At a recent conference on substandard work sponsored by the Russell Sage Foundation, other researchers made clear that even the work of Katz and Krueger may well understate what’s been occurring. In principle, a key distinction is between payroll jobs and casual jobs. But in fact, a lot of people who collect paychecks are working for labor contractors, think Uber — and face much the same deterioration in job quality and job stability as temps and on-demand workers.

Looking at the history of employment stability, the period that we thought of as normal — the years between the New Deal and the 1970s — was exceptional because the government worked for all the people, not just the rich ones. The current US government is as corrupt as the US government was prior to the New Deal, when many workers were casual, as increasing numbers are today.

But in the 1930s and 1940s, work got regularized — not because of changes in technology but because of changes in power. Strong unions and government regulation blocked entire categories of exploitation. With weaker unions and weakened regulation, employers are once again taking advantage, and doing whatever they can get away with.

This is the year that the mass degradation of the terms of work finally got acknowledged by the experts, and belatedly became politicized. Yet the political fallout is up for grabs — between Sanders on the left, Trump on the right, and Hillary Clinton in the center, who is frantically endeavoring to catch up with public opinion and worker frustration — and serve as a credible spokesperson for something better.

In the 1992 campaign, Bill Clinton’s adviser James Carville famously put up a sign that read, “It’s the economy, stupid.” Today, the economy is serving the rich. That’s because income is being redistributed to the rich via trade scams, such as giving China most favored nation status, NAFTA, CAFTA and the South Korea Free Trade Agreement.

If you think things are bad now, the Trans Pacific Partnership will make it even worse. for more information of that, see The Op-Ed the Liberal and Conservative Press Doesn’t Want You To See

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Number one is real simple. I predicted it in my book, The Rigged Game: Corporate America and a People Betrayed, that income inequality is growing in the United States. President Obama, Wall Street Senator Ron Wyden, the Democratic party leadership, Mitt Romney and the Republican party leadership, know this. They all have the same plan regardless of who wins the upcoming presidential election. They plan to make sure income inequality continues to grow by redistributing income and wealth from the 99 to the 1 percent.

Currently, the 1 percent receive about 30 percent of all income in the US, up from about 7-8 percent in 1980. That means the 99 percent have less money to purchase stuff with, which is why the economy is mired in this Great Recession, jobs are scarce, and the economy is tilting on the edge of an economic abyss that will make our current situation look like the good old days.

There is one key difference between the two; Republicans want to redistribute income to the 1 percent faster than the Democrats. Big Deal. The end result is the same; the economic disenfranchisement of the 99 percent. It will soon be banana republic time in the United States. Political disenfranchisement has already occurred.

The rich have created a much larger income gap because they have stolen the money from the 99 percent via US legislation, such as free trade treaties, deregulation and privatization scams. All of these redistribute income from the 99 to the 1 percent.

Liberal Wall Street Senator Ron Wyden, a nasty son-of-a-Wall Street-Bitch, is a driving force behind these scams. Free trade treaties open the door for US businesses to ship (or create) jobs overseas. The difference between the lost higher wage US jobs and the new lower overseas jobs goes into the pockets of the rich via higher corporate profits, surging dividends and rising share prices. The senator of Wall Street knows this but continues to vote for Wall Street and hedge funds over the interests of the 99 percent. Worse yet, the jobs shipped away or created overseas were once the tax base that supported government services, such as schools, roads, bridges, fire fighters and polices.

“The middle class is shrinking. According to Prof. Alan Krueger, Chairman of President Obama’s Council of Economic Advisers, ‘the shift in income inequality over the last three decades is the equivalent of moving $1.1 trillion of income from the 99 percent to the top 1 percent every single year.'” There’s a reason for this. That’s because $1.1 trillion of income has been redistributed every year on average from the 99 to the 1 percent via free trade treaties, deregulation and privatization scams.

The middle class is still shrinking under Obama. He knows this and continues to sign legislation to do exactly this. Last autumn he signed free trade treaties with Panama, South Korea and Colombia. The result, according to numerous estimates, will be a net loss of nearly a million jobs. So the difference between the old higher wages and the new lower wages goes into the pockets of the wealthy. Now Obama has his people negotiating the Trans Pacific Free Trade Agreement (TPP), which the Guardian newspaper of the UK calls “Nafta on steroids.” The TPP will accelerate the decline of the middle class by redistributing more income and political power from the 99 to the 1 percent. Obama knows this, but continues the policy anyway.

So what? Profits are up? Where are the jobs? Obviously, trickle down didn’t work. Worldwide, US corporations are sitting on over $5 trillion. But they can’t invest it because demand is so slack due to the massive redistribution of income from the 99 to the 1 percent.

Wall Street Mitt the Twit Romney claims tax cuts for the rich will stimulate the economy, but 30 years of failed trickle down economics is ultimately the primary reason the current economy sucks big time, like total New Great Depression. The Twit’s trickle down economic policies will only make things worse for the 99 percent. That’s because the 1 percent will have more income with the cuts with which to purchase more legislation from Mitt Romney (if elected), Obama (if re-elected), Ron Wyden, John Boehner, Rand Paul, Earl Blumenauer and lots of others in congress and the senate. So does Obama and Wyden. Too bad for the 99 percent. Apparently, Mitt the Twit thinks the US economy should be used to redistribute income from the 99 to the 1 percent. Make the rich richer at the expense of the rest of us? I don’t think that’s what an economy is for.

Bank profits are enormous because the Federal Reserve continues to help these folks out. Fed Chairman Ben Bernanke last week announced a plan to stimulate the economy. It was a lie. The fed has decided to purchase $40 billion of worthless mortgage backed bonds from wealthy investors and institutions such as investment banks like Goldman Sachs and Morgan Stanley. The Fed will purchase the worthless or nearly worthless bonds on a face value basis. If the investors or banks paid $10 million for the bonds, which are now valueless, the Fed will still pay the stupid bank or investor $10 million for the worthless bonds. The Fed has been very helpful with increasing the profits of banks for several years now using such scams.

CEO pay has risen because the government and the Federal Reserve continue to bail out the rich and help to increase corporate profits by enacting income redistribution legislation, like the South Korea free trade treaty. See the chart above.

There is a reason 1 in 5 US workers earn so little. Wall Street Senator Ron Wyden and others continue to redistribute income from the 99 to the 1 percent via free trade treaties that ship or create jobs overseas. This puts downward pressure on wages in the US, which redistributes income from the 99 to the 1 percent. The same process occurs when too many immigrants come to the US, creating a surplus of labor, which also puts downward pressure on wages. Republicans love this, but so do Wall Street democrats, like Ron Wyden.

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President Barack Obama on Monday tapped one of the nation’s top labor economists, Alan Krueger, to become the next chairman of the Council of Economic Advisers, a selection that underscores the president’s “urgent mission” to jump-start the economy.

Why is the selection of Krueger important? For one, the president decided he wanted to get reelected. So he selected Krueger because he isn’t known to be a former high level employee of Goldman Sachs or Citibank. The Princeton University professor also has performed legitimate research in the labor market. He discovered, for example, that raising the minimum wage of workers in the restaurant industry increases employment in that industry, most likely because it increases the demand for restaurant products. That is something, of course, that FDR knew way back in 1933. And Obama surely knew it last year and the year before, and a dozen years ago. But back in 2008, Obama instead chose to hire Goldman Sachs hacks as his economic advisers. Now that his job security is in jeopardy with the coming election, now that the only difference between Bush and Obama has been exposed (it takes the Republicans a few days more to get what they want under Obama than under Bush, as they continue to redistribute income from the middle class to the rich with Obama’s blessings) the president has decided to put on some working class window dressing so as to appear that he’s working on behalf of working people, which he isn’t, and which he has never intended to do.

“Alan brings a wealth of experience to the job. He’s one of the nation’s leading economists,” Obama said in White House Rose Garden as he introduced the Princeton economics professor, who from 2009 to 2010 served as the Treasury Department’s assistant secretary for economic policy and chief economist. “I have nothing but confidence in Alan as he takes on this important role in my economic team.”

Obama said he expects that Krueger will offer advice that is not driven by partisan politics, especially now that president cannot get any legislation passed without conceding to all of the Republican demands. “We need folks in Washington to make decisions based on what’s best for the country, not what’s best for any political party or special interest,” he said. Like he really expects to do that.

The nomination sets the tone for the administration’s jobs-focused fall, as the White House prepares to announce a major new jobs initiative after Labor Day. There are few prominent labor economists, and the president’s decision to pick one underscores the administration’s aims.

Obama emphasized that reviving the economy is his priority. “Next week, I will be laying out a series of steps that Congress can take immediately to put more money in the pockets of working families, middle-class families,” he said.

The president also pledged the federal government’s continued dedication to providing assistance to those who suffered damage in Hurricane Irene. “It’s going to take time to recover from a storm of this magnitude,” he said, especially in New England, where the storm set off major flooding.

If confirmed, Krueger would be Obama’s third CEA chairman, following Christina Romer and Austan Goolsbee, who left the White House this summer to return to his professorship at the University of Chicago.

Krueger, 50, arrived at Princeton in 1987, after finishing his Ph.D. at Harvard. Jointly appointed in the economics department and the Woodrow Wilson School of Public and International Affairs, Krueger has examined job growth, the effects of increases in the minimum wage and the long-term unemployed.

He spent a year-and-a-half in his previous Obama administration post, working on stimulus measures including the Cash for Clunkers program, Build America Bonds and the Hire America Act. He also served as chief economist at the Labor Department during part of the Clinton administration.

Treasury Secretary Timothy Geithner praised the selection of Krueger, saying he is “one of the most distinguished” people to serve as assistant secretary for economic policy. “Given his expertise in labor economics, he is precisely the right choice to lead the CEA at this moment in history.”
Geithner weighed in on the pick, a Treasury source told POLITICO.

“We obviously said we were strongly supportive of Alan based on his excellent work as the assistant secretary for economic policy here,” said a source familiar with the conversations between the White House and Treasury.

Krueger’s nomination must be confirmed by the Senate, but he’s already cleared that process once in recent years — for the Treasury post — suggesting that the administration has confidence he’ll be able to easily do so again.

Perhaps the president has finally come to his senses, but since he can’t get anything passed through congress, he probably it won’t hurt his attempts to enrich Wall Street at the expense of working people. However, it’s likely the selection of Krueger will make no difference to working folks. His selection at the worst should do no harm, like the president did when he selected Timothy Geither and Lawrence Summers.

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