Category: Political Economy

The Minimum is Not Enough.


“As of today, it’s been four years since the last increase in the federal minimum wage, to $7.25 per hour, or $15,000 per year for full-time work…[T]he current level, by all measures, is just too low…[I]f it had kept up with inflation since its peak in 1968, the federal minimum wage would now be $10.75 an hour. And if the minimum wage had grown along with workers’ productivity, it would be as high as $17.19 today.”

After four years of inaction, CEPR examines the costs of a stagnant minimum wage. Conversely, raising the minimum to $10.10 an hour — as supported by 80% of Americans — would create an estimated 300,000 jobs and add $33 billion to the economy. So you’d think Congress would get on that, yes? Umm…

In very related news, a new AP poll finds that, as a result of stagnant wages, income inequality, and a deteriorating job market, fully 80% of Americans experience poverty, unemployment, and deprivation at some point in their lives. “By 2030, based on the current trend of widening income inequality, close to 85 percent of all working-age adults in the U.S. will experience bouts of economic insecurity.” The American Dream, now with Vegas casino odds.

Online All the Way.

Hello all. So after a month or so of significant work — hence, the relative quiet around these parts of late — I have followed up on my earlier promise/threat and transformed all 1200+ pages of my dissertation into Uphill All the Way, the online edition.

The text was actually already available online in PDF form through Columbia’s Academic Commons, which is one of the reasons I thought converting it for better HTML presentation was a good idea. Now, hopefully, one can peruse the chapters more easily (or someone can skip around to the parts they are interested in.)

I don’t know if this is reassuring or depressing, but reading through it all again over the past month and change, I was once again struck by how much of this story resonates with recent events. Long before the disappointment of the current administration, ostensible progressive Woodrow Wilson had cracked down on civil liberties and broken the heart of the world at Versailles. Before Bradley Manning and Edward Snowden, there was Eugene Debs and Sacco and Vanzetti. Before Austerity, there was Coolidge “Parsimony”. Before Katrina, the Great Mississippi Flood. Before Holder, Palmer. Before today’s continuing fight over evolution, Scopes. Before the recent news of forced sterilizations in California prisons, breaking just this past weekend, there was Buck v. Bell.

Instead of the Tea Party, there were 100% Americans and an Invisible Empire. Instead of fretting about “Obamacare” and “Kenyan Socialists,” conservatives rallied against the Sheppard-Towner Act and a Catholic in the White House. Instead of a War on Drugs, there was a Noble Experiment.

Then as now, civil liberties, corporate corruption, and immigration reform were major issues of the day. Then as now, the Supreme Court was a roadblock to positive change. Then as now, a culture of prosperity masked inequality and deep injustices in American life, and an ascendant business class aimed to leverage its considerable political influence to stamp out workers’ right to organize.

In the 1920s just as much as the 2010’s, progressives struggled to organize in opposition, and began to seriously question the two-party system. Then as now, many lost heart in the possibility of change. And, then as now, the push to make a more just and progressive America was, as always, Uphill all the Way.

Enjoy!

Cold Irons Bound.

“Our prison system is increasingly built and run by for-profit corporations, who have a financial interest in increasing the number of people in prison while decreasing the amount of money it costs to house them. Since 1980, the US prison population has grown by 790%. We have the largest prison population of any nation in the history of the world. One in three African-American men will go to jail at some point in his life.”

In The Guardian Jill Filipovic examines the national shame that is our private prison-industrial complex. “Imprisoning that many people, most of them for non-violent offenses, doesn’t come cheap, especially when you’re paying private contractors…who are doing quite well living off of American corporate welfare -– at the expense of the American taxpayer.” $50 billion a year — that funds a lot of stadium.

This article was found, by the way, in Slate‘s discussion of Sesame Street’s new incarceration kit, which helps explain to 3-8-year-olds that their parent has gone to jail. “That this even has to exist in the first place shows how much pointless damage our prison system does not just to people who are caught up in the overly punitive, often racially biased justice system, but also to their families.”

It’d be nice to say this fiasco is on the national agenda, but, Jim Webb’s efforts in 2009 and some green shoots earlier in the year notwithstanding, Congress and the Obama administration, for all their talk of belt-tightening, seem pretty content with this ridiculous status quo. (One key reason: felons can’t vote.) But, hey, you know who they still don’t put in jail these days? Wolves of Wall Street. So there’s that.

Shudder Island.


If Gatsby didn’t satisfy your hankering for Leo di Caprio amid the playgrounds of the idle rich, the trailer for Martin Scorsese’s The Wolf of Wall Street is now online, also with Matthew McConaughey, Jonah Hill, Margot Robbie, Jean Dujardin, Jon Bernthal, Kyle Chandler, Spike Jonze, Shea Whigham, Rob Reiner, Jon Favreau, and the inimitable Joanna Lumley.

I dunno…I know it’s Scorsese and all that, but at least Gatsby had period panache going for it. This looks like yet another generic Rise and Fall of the Financial Sector Douchebros, and Boiler Room, Margin Call and the Wall Streets, among other films, already covered these useless yahoos enough to my satisfaction. We’ll see.

Potemkin Prosperity.

“What they’ve done is they have filled the shop front window with a picture of what was the business before it went bankrupt or closed. In other words, grocery shops, butcher shops, pharmacies, you name it, they have placed large photographs in the windows that if you were driving past and glanced out the window, it would look as if this was a thriving business. It’s an attempt really by the local authority to make the place look as positive as possible for the visiting G8 leaders and their entourages, and it’s really tried to put a mask on a recession that has really hit this part of Ireland really very badly indeed.”

Not from The Onion: The Northern Ireland town of Enniskillen preps for the G8 summit by constructing a Potemkin village untouched by Britain’s disastrous austerity measures. “This is one big initiative really stemming from the Foreign Office in London. This is David Cameron’s gig. It’s his invitation, it’s his decision to host the G8 in County Fermanagh, which is, don’t forget, part of the United Kingdom.”

Robbing Peter to Pay DePaul.

“It all starts with the person who seems committed to win the current spirited competition as the most loathsome person in American political life: Mayor Rahm Emanuel. The same Mayor overseeing the closing of fifty-four schools and six community mental health clinics under the justification of a ‘budgetary crisis’ has announced that the city will be handing over more than $100 million to DePaul University for a new basketball arena.”

Yet another exhibit in the general brokenness of today’s Democratic Party [See also: RepubliDems, Dems without Spines]: By way of Quiddity, Chicago mayor, former Obama consigliere, and one of the Village’s favorite High Democratic muckety-mucks Rahm Emanuel — who apparently was pulling a 19% approval rating in February — tries to offset school and health center closings in his city with a giant new arena for a sub-par basketball team. (Apologies in advance for the unwieldy, shoehorned-in Angry Birds analogy in the Nation piece.)

“The only explanation for this is that Rahm is scratching someone’s back in the DePaul Catholic hierarchy of Chicago…In this case, the hottest rumor is that approval of legalized gambling is on the horizon and the convention center’s locale will be its epicenter. The arena is, in effect, a Trojan Horse for a casino.”

As I’ve said several times before about this sort of shameful behavior — and Rahm is a frequent offender in this regard — if we Democrats are just going to act like Republicans, voters might as well pull the lever for the real thing.

Series of Melancholy Tubes.

“It was thirty years ago that a band from Manchester released their first single ‘Hand In Glove’. For the next four years they released the songs that made me laugh, made me cry and definitely changed my life even if they maybe didn’t save it…This is my tribute.”

Panic in the Tubes of London: In the spirit of the recent Super-Morrissey, a fan recreates The Smiths’ discography as the Underground. Click through for prints or t-shirts.

Too Big to Countenance.

“Today, the nation’s four largest banks — JPMorgan Chase, Bank of America, Citigroup and Wells Fargo — are nearly $2 trillion larger than they were before the crisis, with a greater market share than ever. And the federal help continues — not as direct bailouts, but in the form of an implicit government guarantee. The market knows that the government won’t allow these institutions to fail. It’s the ultimate insurance policy — one with no coverage limits or premiums.”

Joining ranks across the partisan divide, Senators Sherrod Brown and David Vitter introduce legislation aimed at ending Too Big To Fail: “The senators want the major banks to increase their own tangible equity so that shareholders, and not just taxpayers, take responsibility for their risky actions. They want the banks to have greater liquidity by holding more assets they can immediately turn into cash in a financial crisis. They say they want to keep Wall Street banks that enjoy government backing from gaming the financial system with credit derivatives and other risk-inflated schemes, which even JP Morgan Chase’s own employees failed to catch until too late.”

Naturally, the banks will be fighting this with everything they have, and Goliath usually wins these fights in Washington. They’re already leaning on one of their favorite Senators, Chuck Schumer, to block Brown from ascending to Chair of the Senate Banking Committee. Nonetheless, the progressive-conservative alliance here suggests, at the very least, a new wrinkle in the game.

In related news, companies are also wheeling out the Big Guns to threaten the Securities and Exchange Commission over potential new corporate disclosure rules for political spending — namely, making businesses disclose their campaign donations to their shareholders. Seems innocuous enough, but of course, “[t]he trade associations lining up in opposition to the rule amount to a roll call of the most politically influential — and highly regulated — industries in the country.”

For Want of a Spreadsheet Check…

“This error is needed to get the results they published, and it would go a long way to explaining why it has been impossible for others to replicate these results. If this error turns out to be an actual mistake Reinhart-Rogoff made, well, all I can hope is that future historians note that one of the core empirical points providing the intellectual foundation for the global move to austerity in the early 2010s was based on someone accidentally not updating a row formula in Excel.”

As Mike Konczal of Rortybomb explains, the Reinhart-Rogoff paper “Growth in a Time of Debt,” which argued that high debt-to-GDP ratios stymie growth and has been one of the key economic foundations for recent deficit hysteria, turns out to be fundamentally flawed.

“This has been one of the most cited stats in the public debate during the Great Recession,” embraced by both Paul Ryan and the Washington Post. And it’s totally upside down. As Konczal says, “[t]he past guides us…it tells us that a larger deficit right now would help us greatly.”

Update: Dean Baker weighs in. “If facts mattered in economic policy debates, this should be the cause for a major reassessment of the deficit reduction policies being pursued in the United States and elsewhere. It should also cause reporters to be a bit slower to accept such sweeping claims at face value.”