by Ben Atlas on Mar 3, 2010 - 23:53
TNR – Washington Diarist: The New Proles:
“Lately, however, I have been observing a high incidence of indecent poverty. Many young writers and journalists I meet are close to penniless. They have almost not a hope of supporting themselves in the pursuit of their calling. A garret is no longer affordable. Jobs are disappearing. Internships are unpaid or barely paid, which has the consequence of corrupting a meritocratic system with the inequities of social class, as the fortunately born become the fortunately hired. And when they publish what they write–well, now we leave the honorable tradition of the struggling young writer for the unprecedented enchantments of the digital revolution.”
by Ben Atlas on Feb 7, 2010 - 10:46
There is this peculiar impression that till the enraged voters in Massachusetts sent a Republican to the Senate, no one, except the unemployed, remembered about the devastating structural changes in the economy. I am not talking about the Jews here specifically; perhaps this is a metaphor for any group. But I always wondered how the Holocaust or the Gulag happened in plain view of humanity but more importantly in plain view of the indifferent world Jewry.
First the layoffs, the crushing cleansing, when many firms cut people they would never dare to, if not for the fact that “everyone was doing it”. This is the middle class depression, more than a half of all jobs lost disappeared permanently. Jews are predominantly middles class and it’s natural that the community is hit particularly hard. Add to this the reality that many of the “working orthodox” feed off the economic margins that are now cut to the bone. For many families this is an unimaginable disaster and speaking of Holocaust, virtually no one is talking about this with the required urgency.
My friend tells me that perhaps the economic realm is not longer within the expertise of the communal organizations. But if this true than what is the rationale for a community that doesn’t have a charter for the mutual support? The communal institutions in service of the oligarchy unelected and permanently detached from the rank and file, accountable only to super rich. Occasionally easing their conscience by fundraising drives for the faraway lands from Haiti to Haifa, the further from home, the better.
Anecdotally many of my friends, who find themselves in the financial distress, tell me that if they try to share their misfortune with others there is a quick comeback and cutoff: “everyone is unemployed, everyone is losing a home, etc.” To be sure, not “everyone”, but there is callousness to this response as if no compassion, never mind a real help, is required, as if you are supposed to die in a plague.
Most people I know are traumatized more by the apathy than by the actual economic downfall. We expect and accept the financial risks and stumbles but the complete indifference by the people who claim a kinship is a life long trauma. And just like with the Great Depression there will be a new generation that doesn’t care and doesn’t remember. The life goes on but our connections to the fellow human beings will never be the same.
by Ben Atlas on Jan 31, 2010 - 22:31
The chart shows different categories amongst currently unemployed. The light blue on the bottom represents the lost jobs that are lost permanently die to an economic structural change. You can see that it grew from about 25% in the 60s and suddenly jumped during this recession to 55% of lost jobs (Jan. 2009 data, must be much higher now). NYT – The Growing Underclass: Jobs Gone Forever.
by Ben Atlas on Jan 31, 2010 - 22:05
Propublica – Unemployment Insurance Tracker:
“The unemployment insurance system is in crisis due to a combination skyrocketing unemployment and – in some cases – poor planning. A record 20 million Americans collected unemployment benefits last year, and twenty-six states have run out of funds and been forced to borrow from the federal government, raise taxes, or cut benefits. In many other states the situation is deteriorating fast.”
by Ben Atlas on Jan 19, 2010 - 09:00
Speaking of bankers. The “international superstar” Erin Burnett does a segment for the MSNBC’s ‘Morning Joe’ about the Citigroup’s earnings, the $1.5 billlion loss last year, plus (or is it minus) 100K layoffs globally. The usual “executive bonuses” jive follows. The metrosexual moron Donny Deutsch starts yapping about the bankers showing some good PR by sending cash to Haiti. Without disputing the gesture Erin Burnett politely asks what would they do with all the money in Haiti? But no one asks the obvious question. Didn’t you just report on the loss of the hundred thousands jobs!? At some point you will need the jobs to send money anywhere, even, gasp, your next door neighbor.
by Ben Atlas on Jan 19, 2010 - 07:00
Jaron Lanier wrote about his book for the WSJ – World Wide Mush:
“The U.S. made a fateful decision in the late 20th century to routinely cede manufacturing and other physical-world labors to foreign competitors so that we could focus more on lucrative, comfortable intellectual activities like design, entertainment and the creation of other types of intellectual property. That formulation still works for certain products that remain within a system of proprietary control, like Apple’s iPhone.
Unfortunately, we were also making another decision at the same time: that the very idea of intellectual property impedes information flow and sharing. Over the last decade, many of us cheered as a lot of software, music and news became free, but we were shooting ourselves in the collective feet.
On the one hand we want to avoid physical work and instead benefit from intellectual property. On the other hand, we’re undermining intellectual property so that information can roam around for nothing, or more precisely as bait for advertisements. That’s a formula that leaves no way for our nation to earn a living in the long term.”
I wonder if WSJ paid Jaron for the article or is this just a free book commercial? And of course people who scale and monetize the hive, like Google who puts ads on the creative output without paying a cent, stand to extract wealth on the scale unknown in history, while the creative effort itself is worthless.
by Ben Atlas on Jan 7, 2010 - 08:11
MSNBC lists only the losses for the three quarters of 2009 (the available data). For the total year loss, add approximately a quarter to all numbers. The aggregate for the recession is not available (some of my notes included).
- Architects – 17.8% decline, 189K jobs lost (in 3 quarters of 2009 all figures) (as with all construction related professions the downturn started in 2008, the housing crash preceded the financial crisis and the general recession. So the aggregate number for all construction related losses is actually much higher, perhaps double).
- Carpenters – 17% decline, 1.3m jobs lost.
- Production supervisors and assembly workers – 16% decline, 754K supervisors jobs lost and 876K assembly workers jobs lost (the continuing decline of the American manufacturing, plus the collapse of the automobile industry).
- Pilots – 30.5% decline, 96K jobs lost (didn’t know there were that many pilots. The drastic decline of business travel, plus the industry still reeling from the hikes in gas prices).
- Computer software engineers – 10% decline, 970K jobs lost (despite the demand for the “high end geeks”, the rank and file (pun intended) of the programmers jobs continue to be downloaded overseas, the programming is a harbinger of outsourcing yet awaiting other professions).
- Mechanical engineers – 18% decline, 247K jobs lost.
- Construction workers – 14% decline, 1.56m jobs lost (in addition to 1.8m lost in 2008)
- Tellers – 12% decline, 407K josb lost (the first to go during a banking crisis).
- Bookkeeping, accounting and auditing clerks – 13% decline, 1.25m jobs lost.
by Ben Atlas on Dec 22, 2009 - 19:41
by Ben Atlas on Dec 19, 2009 - 17:29
This seems like an oxymoron, yet Noam Scheiber asks in the New Republic - Why Do German and Japanese Manufacturers Innovate More?
“The logic of this comes from the Harvard Business Review piece by Robert Hayes and William Abernathy that I cite. Hayes and Abernathy basically make two points. First, because the Europeans and Japanese rely so heavily on overseas markets, where the prices of their products can fluctuate owing to factors beyond their control, like exchange rates and tariffs, their manufacturers are forced to focus on quality and technological superiority. Technological advantages remain even when an exchange rate cuts against you. By contrast, American companies have always had a huge domestic market, so they could afford to mostly compete in terms of price. (They certainly don’t have to, but they can get away with it, whereas the Japanese can’t and the Europeans couldn’t for decades.) As a result, managers at American industrial companies have tended to think a bit more in terms of short-term costs–ways to undercut the other guy rather than outperform him.
Second, because labor markets tend to be less flexible and hourly labor costs tend to be higher in Europe and Japan (consider Germany’s famously powerful industrial unions), manufacturers there couldn’t traditionally cut costs very easily even if they wanted to. Whereas American manufacturers could often lower costs simply by lowering wages or axing employees, the Germans and Japanese had to either make their workers productive or have them produce more valuable products. It’s not that American manufacturers never did the latter, of course. But some of our foreign competitors simply had no choice, and they were very good at making virtue of necessity.”
I am not familiar with the automobile industry but I can speak about the construction industry. America is much more sensitive to risk and litigation. Today most innovative construction materials come from Europe. There is less litigation and regulation in Europe. For example there is a short cycle for the approvals of the experimental drugs. In order to innovate you need to have a high tolerance for the mistakes and failures. Risk aversion is the avoidance of experimentation and innovation. Especially if you don’t have a job security, like they do in Europe. If you feel secure about your job you are can be inclined to innovate and to experiment. The picture is actually reversed in the High Tech field, compared to the manufacturing. I think this is due to the fact that the startup category is a “financial allocation” in America, etc.
by Ben Atlas on Dec 19, 2009 - 10:43
Flood victims lined up to get food & clothing fr. Red Cross relief station in front of a billboard. February 1937, Louisville, KY . Photo by Margaret Bourke-White
The fist years of a recession aren’t that bad for people who have jobs and means. The taxes haven’t risen yet and the city services are sill intact. The products become actually cheaper and the bubble generates enough optimism for the stock marker to pretend that nothing changed. And then the city services catch up and everyone starts to notice. LA Times – City retirements threaten a deep and lasting legacy:
“Some policymakers have only begun grasping the magnitude of the exodus of librarians, building inspectors, traffic officers, city planners and other workers, many of them the city’s most experienced employees.”
by Ben Atlas on Dec 16, 2009 - 07:56
I was listening to Charles Krauthammer the other day when he said: “We shouldn’t pressure the banks to lend, because the risky lending got the economy in trouble in the first place”. What Charles omits or perhaps doesn’t understand is that the Feds reduced the borrowing rate to ZERO. You can’t go wrong with free money, their are global brands that can give you and nice interest on your zero costs. Or as Henry Blodget explains in the linked post you can even do an end run on the US Treasuries. This also means that it technically doesn’t matter what American economy or even the American consumer does, because their money could be “outsourced” to the global marker, leaping over the good old USA. This pretty much explains the boom in the financial sector while the economy is still in terrible shape. Henry Blodget outlines the 11 steps to make a billion – How To Make The World’s Easiest $1 Billion.
by Ben Atlas on Dec 15, 2009 - 08:07
WSJ – More Foreign-Born Professionals Are Finding Better Jobs, Lower Unemployment Abroad.
“HSBC Bank International’s 2009 Expat Explorer survey found that 23% of U.S.-based expats are considering returning home, compared with 15% elsewhere in the world. The most frequently cited reason was increasingly limited career prospects, according to the survey of more than 3,100 expats, defined as anyone over 18 living outside their country of origin. Many of these workers have become dissatisfied with their compensation or advancement opportunities in the U.S. and perceive better opportunities back home or in other parts of the world.”
The parallel article about China, WSJ – World’s Top Polluter Emerges as Green-Technology Leader.
