Sunday Reads: Bacon on Wheels, Alpaca Buzz Cuts and Penguins on Parade
Posted: June 2, 2013 Filed under: Africa, Baby Boomers, children, Climate Change, Crime, Criminal Justice System, Economy, Environment, Foreign Affairs, George W. Bush, Germany, Hillary Clinton, History, income inequality, Japan, morning reads, nature, Politics as Usual, poverty, Psychopaths in charge, racism, Revisionism, science, seniors, sports, the internet, U.S. Military, Violence against women | Tags: DOJ, Samuel L Jackson, Native American Indians, Military sexual assault, Naval Academy, Miami Dade Police brutality, Chris P. Bacon, Mascots, Washington Redskins 21 Comments »
Good Morning
Guess you can tell from the title of this post, animals will play a feature role in today’s reads. Right now here in Banjoville the skies are opening up and raining down cats and dogs. Loud thunder is shaking the house, and that means lightning…real bad lightning…so I best make this post short and sweet. So here are your morning reads in link dump fashion.
Well, down in Miami the police roughed up a kid who was holding a puppy because he looked at them funny. I should say not funny as in funny amusing, but as they put it….”dehumanizing.”
Police Allegedly Assault Black Kid Carrying A Puppy For Looking At Them Wrong
Miami-Dade Police allegedly handcuffed and choked a 14 year old boy while he was carrying a newborn puppy for giving them a “dehumanizing” stare. A court case over the incident will begin on July 16th.
Tremaine McMillian was, by his account, playing on a beach with a friend and his puppy on the Miami boardwalk when police came over to tell them to stop “roughousing.” Though the police later admitted the boys’ activity was neither criminal nor violent, they asked the boys where their parents were. McMillian directed the officers to his nearby mother, and that’s where the family and the police’s story diverge.
McMillian and his mother, Maurissa Holmes, say the police chased down McMillian on ATVs and attacked him essentially without provocation. “The police officers were on their ATVs, and my son was walking,” Holmes said. “They jumped off their ATVs, grabbed him and slammed him to the ground.”
You can read the police’s version at the link, you can also see video of the arrest as well…there are some discrepancies however…pointed out by Tommy Christopher…check this out.
…there’s another painfully adorable detail that was left out of that report. Here’s what Miami-Dade Police Detective Alvaro Zabaletatold CBS 4:
Miami-Dade Police Detective Alvaro Zabaleta told D’Oench it was just after 11:00 am on Memorial Day on Haulover Beach when officers saw McMillian slamming another teenager on to the sand.
“They told him that behavior was unacceptable,” said Zabaleta. “He walked away and officers followed him. They asked where his parents were. He said he was not going to take them to them. When he started to leave the beach area, officers had to get off their ATVs to detain him. He had closed arms, clenched fists and pulled his arm away.”
“Once he was approaching the road, the officers restrained him. Again his body language was that he was stiffening up and pulling away,” said Zabaleta. “Now you’re resisting officers at that point and when the hands are swinging and you are resisting officers, at that point you have to be taken into custody.”
“Of course we have to neutralize the threat,” said Zabaleta. “When you have somebody resistant to them and pulling away and somebody clenching their fists and flailing their arms, that’s a threat.”
He said the police report did not indicate that a puppy was involved.
“At that point we are not concerned with a puppy,” said Zabaleta. “We are concerned with the threat to the officer.”
So, the police don’t seem to be disputing that the puppy was there, just that he didn’t merit inclusion in the report. But if the puppy was there, then how do police explain this?
“How could I be clenching my fists when I was taking care of my puppy and giving him some milk with a bottle?” asked McMillian.
I mean the kid was giving the newborn puppy a bottle of milk…WTF?
Shit…with the way law enforcement authorities are reporting things lately, that bottle of milk could have been a rocket launcher and the puppy? Well that was no puppy, that was a dwarf Muslim terrorist, hey….don’t mistake that fur for the towel on his head. /snark
I want to bring this story to your attention, it is about pigs but not the real animals. U.S. Naval Academy football players investigated for sexual assault | Reuters
Three members of the U.S. Naval Academy football team are being investigated for the alleged sexual assault of a female student, the Pentagon said on Friday, the latest in a string of scandals that have thrown a spotlight on sex crimes in the military.
The alleged incident took place in April 2012, when the student attended a party at the off-campus “football house” in Annapolis, Maryland and became intoxicated, her attorney, Susan Burke, said in a statement.
“She woke up at the football house the next morning with little recall of what had occurred. She learned from friends and social media that three football players were claiming to have had sexual intercourse with her while she was incapacitated,” Burke said, without identifying her client by name.
No charges have been brought forth yet, this is still being investigated.
Burke said that one of the football players pressured the woman not to cooperate with an initial investigation into the case. She initially followed that advice, but was still “ostracized and retaliated against by the football players and the Naval Academy community.” She was also disciplined for drinking, Burke said in a statement.
In early 2013, the female student decided to seek legal help and the Navy re-opened the investigation, Burke said.
“Over time, the midshipman began to recover from the trauma, and became angered at the lack of justice and retaliation in her case,” she said.
I am sure that this investigation will eventually end up like these cases usually do. But with the congressional hearings coming up…maybe there will be a fire under the ass of these military brass and justice will finally take a front seat and not get molested like so many of these women service members.
Here is yet another article about shitty pay and what it does to the economy. One Walmart’s Low Wages Could Cost Taxpayers $900,000 Per Year, House Dems Find
Then you have the other side of the coin, y’all heard that Tumblr was sold to Yahoo for 1.1 billion dollars…check this out: Tumblr’s Creative Director Quits
On to something more interesting, these next two links are about different things…but deal with the same subject.
First, this article from the New York Times: Justice Dept. Reports Rise in Prosecutions on Indian Lands
The Justice Department said this week that it had increased its rate of criminal prosecutions in Indian country by more than 50 percent in the past four years, a period in which violent crime on the nation’s Indian reservations has soared and tribes have complained of lawlessness.
The data, part of a Justice Department report released Thursday, found that United States attorneys had prosecuted about 69 percent of the 3,145 criminal cases referred to their offices from Indian country last year — an improvement over 2011, when the federal government tried 63 percent of 2,840 criminal cases in Indian country.
The report comes amid a wave of violent crime on Indian lands and criticism of the Justice Department by tribal officials who say United States attorneys pursue far too few violent criminal cases on reservations.
Prosecutors say they must decline many Indian country cases — about 60 percent of the total — because of a lack of evidence.
The feds usually prosecute murder, rape and white-collar crimes, but these numbers are a bit confusing because there is a new law that went into effect which includes various other violent crimes.
Previous government data have cited violent crimes, which presented a more pessimistic picture: that the Justice Department files charges in only about half of Indian country murder investigations and one-third of sexual assault cases. The data also showed the number of prosecutions by United States attorneys of violent crimes fell by 3 percent from 2000 to 2010, even as crime on some reservations increased by 50 percent or more.
But the report released this week does not separate the number of federal prosecutions for violent crimes. Instead, the report groups them with drug cases and white-collar crime.
On Friday, Wyn Hornbuckle, a Justice Department spokesman, said the analysis did not specify figures for violent crime because the department was not required to do so by the Tribal Law and Order Act, a 2010 law that mandates that the department release prosecution rates in Indian country. (This week’s report is the agency’s first since the law went into effect.)
I guess these reports are just like any other reports out there, what the hell do they really tell us? And do they exist so people can twist these department figures to their advantage, and by doing that manipulate the dialogue to justify their own agenda. (I know the answer to that…)
The other link is this: Do Mascots Need Modernizing? « The Dish
Earlier this week, ten members of Congress sent a letter to the front office of the Washington Redskins, pushing them to select a new mascot:
In this day and age, it is imperative that you uphold your moral responsibility to disavow the usage of racial slurs. The usage of the “R-word” is especially harmful to Native American youth, tending to lower their sense of dignity and self-esteem. It also diminishes feelings of community worth among the Native American tribes and dampens the aspirations of their people. We look forward to working with you to find a solution to this important matter.
This is something that I am hesitant to get involved in. I am no fan of the Atlanta Braves, but they also have an Indian mascot. There is talk of getting the government involved, like previous strategy used by the JFK admin when the Redskins owners would not integrate the team. See the JFKs guys would not allow the Redskins on the stadium property because it was federal land…however,
Doug Mataconis disagrees with the liberal lawmakers’ strategy:
I have to wonder why this is something that Members of Congress need to be getting involved in, or why legislation is necessary to address something that is, in the end, a private business matter.
The people who don’t like the name are free to protest it. Dan Snyder and the rest of Redskins ownership are free to reject their pleas. If there ever comes a time when the public sympathizes with the protesters, then perhaps the team will feel the kind of economic pressure most likely to cause them to change positions, then we’ll likely see a name change of some kind.
Personally, I think the odds of that happening are pretty remote. The Redskins name has been in existence now since 1933 when the football version of the Boston Braves changed its name to Boston Redskins before moving to Washington, D.C. several years later. We’re not that far away from the 100th anniversary of that name. It’s going to be around for a long time to come, and I’m just fine with that.
Well, the Redskins play on the FedEx field in Maryland now…and it isn’t on Federal land. Like I said, I don’t know how I feel about this…guess we will talk about it in the comments below.
Ralph posted a link to an article about the DOJ Press Leaks by Walter Pincus last week in the comments and I thought everyone would appreciate this response from the ACLU. (I remembered the name Pincus because of Seinfeld…and Kramer, “Poor little Pincus.”) Anyway: Responding to The Washington Post’s Walter Pincus on Leaks and Shield Laws | American Civil Liberties Union
There is a rumor going round that Hillary Clinton is getting her own Twitter Hillary Clinton To Start Using Twitter: Report:This is supposed to be her handle…
https://twitter.com/HillaryClinton
For some far out images, Global flight-path maps: Five interpretations Large pictures here: In pictures: Global flight paths
A bit of Manhattan History for those of you who are the nostalgic types: 1930s New York subway train makes rare trip from Queens to Manhattan
May 30, 2013: In this photo provided by the New York Mass Transit Administration, an unidentified MTA employee checks the platform from between the cars of a 1930’s era subway train in the Queens borough of New York. (AP/Mass Transit Administration)
[...]
Lucky straphangers who happened to be in the right place at the right time on Thursday got to ride in eight subway cars purchased between 1930 and 1939.
The Metropolitan Transit Authority says some of the cars were taken out of the New York Transit Museum to commemorate the opening of a stretch of subway tracks badly damaged during Superstorm Sandy.
After the ceremony, the cars were put into regular passenger service for one quick trip from Queens to upper Manhattan.
Riders on board the train took pictures and gawked at its old-school style. Ads for Clark bars, fireworks shows on Coney Island and Levy’s Rye Bread adorned the walls.
More history for you, this is Breaking Bad meets Inglorious Basturds: Crystal Meth Origins Link Back to Nazi Germany and World War II – SPIEGEL ONLINE
Crystal meth is notorious for being highly addictive and ravaging countless communities. But few know that the drug can be traced back to Nazi Germany, where it first became popular as a way to keep pilots and soldiers alert in battle during World War II.
“Alertness aid” read the packaging, to be taken “to maintain wakefulness.” But “only from time to time,” it warned, followed by a large exclamation point.
The young soldier, though, needed more of the drug, much more. He was exhausted by the war, becoming “cold and apathetic, completely without interests,” as he himself observed. In letters sent home by the army postal service, he asked his family to send more. On May 20, 1940, for example, he wrote: “Perhaps you could obtain some more Pervitin for my supplies?” He found just one pill was as effective for staying alert as liters of strong coffee. And — even better — when he took the drug, all his worries seemed to disappear. For a couple of hours, he felt happy.
This 22-year-old, who wrote numerous letters home begging for more Pervitin, was not just any soldier — he was Heinrich Böll, who would go on to become one of Germany’s leading postwar writers and win a Nobel Prize for literature in 1972. And the drug he asked for is now illegal, notoriously so. We now know it as crystal meth.
Man, that is some fucked up shit.
Alright, since we touched on chemistry…here is a link that ties in perfectly. Molecule Chemical Bond Images From UC Berkeley | Geekosystem
Have you ever looked at a textbook diagram of the chemical bonds that make up molecules and thought to yourself, “This is just a dumb drawing — how do they know what it even looks like in real life?” Well stop it. Stop it right now. Felix Fischer of the U.S. Department of Energy’s Lawrence Berkeley National Laboratory is going to show you what it looks like with these gorgeous high-resolution images of individual carbon atoms linking together. And guess what? They look just like they do in the textbooks. Happy now?
I swear I had no idea these things really looked like this! Did you? Go to the link to read the rest. Amazing.
Back now to my own comfort zone: ‘Amazingly rare’ letter written by Robert the Bruce to Edward II found (But I gotta say, I hated the movie Braveheart!)
An unknown and “amazingly rare” letter written by Robert the Bruce at a pivotal point of the Wars of Scottish Independence has been uncovered by a Scottish academic.
In the letter, the fearsome Scottish warrior appeals to the English King Edward II for an end to “persecution and disturbance”. It was sent in 1310, less than four years before Bannockburn, the victory that paved the way for Scottish independence.
Dauvit Broun, professor of Scottish History at the University of Glasgow, found the letter in The British Library while studying a manuscript written by the monks of Kirkstall Abbey about 500 years ago. The correspondence happened to be copied by the monks into their manuscript, the original has not survived.
Professor Broun said: “It’s amazingly rare, a freak survival. There’s nothing like this that survives from around that time.”
Listen to the tone of Robert the Bruce…
Bruce wrote to “beseech” the king that “you would take pains to cease from our persecution and the disturbance of the people of our kingdom in order that devastation and the spilling of a neighbour’s blood may henceforth stop.”
Take a look at the rest of the article at the link. I wish they had printed the full letter. I would have loved to read the whole thing myself.
Real quick archeology links:
Japan’s Oldest-Known Wooden Mask – Archaeology Magazine
San “Rain Control” in South Africa – Archaeology Magazine
Earlier this week I linked to the female mammoth with flowing blood that was found in Siberia…well, this was another cool “ice age” related article that I was planning on sharing with you: Centuries-old frozen plants revived
Plants that were frozen during the “Little Ice Age” centuries ago have been observed sprouting new growth, scientists say.
Samples of 400-year-old plants known as bryophytes have flourished under laboratory conditions.
Researchers say this back-from-the-dead trick has implications for how ecosystems recover from the planet’s cyclic long periods of ice coverage. The findings appear in Proceedings of the National Academy of Sciences.
The receding glaciers are exposing land that has not seen daylight since the mini ice age.
Bryophytes are different from the land plants that we know best, in that they do not have vascular tissue that helps pump fluids around different parts of the organism.
They can survive being completely desiccated in long Arctic winters, returning to growth in warmer times, but Dr La Farge was surprised by an emergence of bryophytes that had been buried under ice for so long.
“When we looked at them in detail and brought them to the lab, I could see some of the stems actually had new growth of green lateral branches, and that said to me that these guys are regenerating in the field, and that blew my mind,” she told BBC News.
“If you think of ice sheets covering the landscape, we’ve always thought that plants have to come in from refugia around the margins of an ice system, never considering land plants as coming out from underneath a glacier.”
But the retreating ice at Sverdrup Pass, where the Teardrop Glacier is located, is uncovering an array of life, including cyanobacteria and green terrestrial algae. Many of the species spotted there are entirely new to science.
And from that story of new life from ancient plants to a post in The Atlantic, I will just put it here because…well, you all will see why: Why the Boomers Are the Most Hated Generation – Edward Tenner – The Atlantic (Look at the comments, some of them are funny and vicious indeed.)
While you “feast” on that, take a look at this op/ed from the LA Times…Jefferson Davis’ ‘presidential’ library - It offers a rallying point for the myth of a gentle and just South dragged into the War of Northern Aggression.
And then…think about that little island in the Mediterranean for all us Sky Dancers to escape to: The island of long life – On the Greek island of Ikaria, life is sweet… and very, very long. So what is the locals’ secret?
The island of long life – in pictures | Life and style | The Guardian
BTW, did you see my man Samuel L Jackson and his latest video? Samuel L. Jackson Quitting Acting To Pursue A ‘Life Of Vigilantism’? | Mediaite
Samuel L. Jacksonsubmitted a challenge to the Reddit community this week. “It’s simple,” he wrote, “write 300 words and the most upvoted post I’ll read out loud in monologue form.” Today, Jackson posted the winning monologue video and it was just as “bad-ass” as promised.
“Hi, I’m Samuel L. Jackson,” he began, “I’m sorry to disappoint you, Reddit, but I’ve decided to break the rules of my own competition.” From there, the actor said he wanted to “speak to you all from my own heart, in my own words” before announcing that he was “quitting acting and pursuing a life of vigilantism.” Fortunately for fans of one of America’s most prolific actors, this was all part of the winning submission from Reddit user adiddy.
I love this mutha…
Jackson set up the unconventional contest to help raise money for the Alzheimer’s Association, and revealed on Reddit that the campaign had raised over $130,000. Everyone who donated was entered to win lunch with Jackson and a trip to his UK celebrity golf tournament.
The whole thing almost got “derailed by the internet forum 4Chan”but here it is…
Whoa….ooooeeee, that dude is awesome.
Now for the animals.
Sheared Alpaca – Business Insider
Farmers shear an alpaca at a zoo in Shijiazhuang, Hebei province, May 30, 2013…
Scrawny under all that fleece aren’t they. I just got one thing to say, that alpaca is not getting sheared by someone looking to spin the fiber into yarn. What a waste! Butcher of a job…
See:
What a difference….those of you inclined to fiber fun, check out the video and watch these guys get sheared.
Shearing Movies | Cliff House Alpacas
And see how the fiber is prepared:
After we Shear we Skirt | Cliff House Alpacas
Alright then, moving on to the penguins.
So This Happened | TPM Editors Blog
To greet African leaders arriving for conference in Japan, event organizers force group of Penguins to dress up in ‘African’ costumes …
And finally, meet Chris P. Bacon: The wheelchair pig
A Florida veterinarian who fashioned a wheelchair for his pet pig has just signed a three-book publishing deal on the life and adventures of his little friend he named Chris P. Bacon.
That’ll do pig. Oh he is so damn cute.
Geez, 3360 words later, short and sweet my ass!
That should keep everyone busy, now some of you will have storms to look out for today, so stay alert: Severe Weather Warnings Page
And if you are around, stop and leave a comment or two….have a wonderful day!
Monday Reads
Posted: May 6, 2013 Filed under: American Gun Fetish, Austerity, children, Economy, Foreign Affairs, Homeless, Israel, Mental Health, morning reads, Syria | Tags: Gabby Giffords, gun, israel, safety, Syria, toxic products for children, wealth inequality 34 Comments »
Good Morning!
There’s a lot going on in the middle east as tensions mount between Syria and Israel. The situation continues to unravel.
Israeli jets devastated Syrian targets near Damascus on Sunday in a heavy overnight air raid that Western and Israeli officials called a new strike on Iranian missiles bound for Lebanon’s Hezbollah.
As Syria’s two-year-old civil war veered into the potentially atomic arena of Iran’s confrontation with Israel and the West over its nuclear program, people were woken in the Syrian capital by explosions that shook the ground like an earthquake and sent pillars of flame high into the night sky.
“Night turned into day,” one man told Reuters from his home at Hameh, near one of the targets, the Jamraya military base.
Former Arizona Congress Woman Gabby Giffords won a profile in courage award in Boston. Her new role is an outspoken and effective symbol for more gun safety laws.
“It takes real courage to overcome a disability that is so personal,” says Guy McKhann, a leading neurologist at Johns Hopkins University.
Although he hasn’t treated her, he says it was clear that, distinct from cognitive abilities, retrieving the right words is difficult for Giffords. “What she wants to say sometimes doesn’t come out,” McKhann says. (A personal disclaimer: I am chairman of the Profile in Courage Committee that honored her Sunday and have a son with a brain injury.)
On Jan. 8, the two-year anniversary of the shooting, Giffords and Kelly started Americans for Responsible Solutions. They’ve already raised more than $10 million, enlisted more than 300,000 supporters, aired national television ads advocating expanded background checks for gun purchases and campaigned for the measure in a dozen states.
They are perfect for this role. She is a courageous survivor of a gun attack, a former Western member of Congress, a longtime hunter and supporter of gun rights. He is a combat veteran, Navy pilot and space shuttle commander. The National Rifle Association can’t paint them as effete foes of the Second Amendment.
In January, Giffords delivered emotional testimony on the measure to the Senate Judiciary Committee. She and Kelly personally lobbied members. Before last month’s Senate vote on the proposal, she sought out Arizona Republican Jeff Flake, a friend from her House days, and blurted out, “Need,” as in we need you. Unlike his Arizona colleague John McCain, who backed the background checks compromise, Flake voted no. The measure failed; since then, polls show a drop in Flake’s home-state popularity.
If you have young children around, this should scare you. You should also check the list at the link in the article to see if any of this crap is in your home.
Over 5000 children’s products contain toxic chemicals linked to cancer, hormone disruption and reproductive problems, including the toxic metals, cadmium, mercury and antimony, as well as phthalates and solvents. A new report by the Washington Toxics Coalition and Safer States reveals the results of manufacturer reporting to the Washington State Department of Ecology.
Makers of kids’ products reported using 41 of the 66 chemicals identified by WA Ecology as a concern for children’s health. Major manufacturers who reported using the chemicals in their products include Walmart, Gap, Gymboree, Hallmark, H & M and others. They use these chemicals in an array of kids’ products, including clothing, footwear, toys, games, jewelry, accessories, baby products, furniture, bedding, arts and crafts supplies and personal care products. Besides exposing kids in the products themselves, some of these chemicals, for example toxic flame retardants, build up in the environment and in the food we eat.
Examples of product categories reported to contain toxic chemicals include:
- Hallmark party hats containing cancer-causing arsenic
- Graco car seats containing the toxic flame retardant TBBPA (tetrabromobisphenol A)
- Claire’s cosmetics containing cancer-causing formaldehyde
- Walmart dolls containing hormone-disrupting bisphenol A
Kinda terrible isn’t it?
The basic idea behind Keynesian support for stimulus/opposition to austerity under current conditions is that when private demand is weak and monetary policy is up against the zero lower bound, there is no offset to changes in government spending. This shouldn’t be a hard concept to grasp — in particular, you would think that anyone posing as an economist could grasp the conditional nature of the statement.
Meanwhile, the proof is in the results. Look at the record highs in the Eurozone unemployment numbers.
European unemployment has hit a new record and Moody’s cut Slovenia’s debt rating to junk status as German Chancellor Angela Merkel defended her crisis strategy, pushing for twin goals of fiscal rigour and growth.
Grim new data showed on Tuesday that European unemployment set a fresh record in March with more than 19 million jobless people — including one out of four under-25-year-olds.
The Eurostat data agency reported an extra 62,000 people joining unemployment queues in just four weeks in the eurozone as the jobless rate climbed for the 23rd consecutive month — hitting 12.1 percent in March.
The frightening new figures — which showed almost two in three under-25s in Greece and Spain unemployed — come amid vocal criticism over the effects on jobs of the cost-cutting measures pushed by austerity advocates.
Anger against austerity is rising across Europe as hard economic data fails to show a turn-around.
Greece saw joblessness climb relentlessly to 27.2 percent in January, the latest available figures, from 26.3 percent in December.
Meanwhile Portugal, with unemployment at 17.5 percent in March, was seeking to agree new austerity measures after its Constitutional Court rejected as discriminatory cuts to civil servant salaries and pensions decided in response to demands by EU-IMF lenders.
In Cyprus, which saw a huge month-to-month rise in unemployment to 14.2 percent against 10.7 percent the previous month, the parliament was to debate the terms of a tough 10-billion-euro EU-IMF bailout.
The EU’s employment and social affairs commissioner Laszlo Andor warned that “EU institutions and governments, business and social partners at all levels need to do all they can to avoid a ‘lost generation’”
There is absolutely no reason for us to relive the Great Depression years and the complete political upheaval that resulted. I just do not get the obsession with debt. This is especially true because there is so little evidence for it and what evidence was provided was shown to be falsified, error-riddled, and just plain wrong by these kinds of numbers.
I wanted to end with a story that should be on every one’s radar but probably isn’t. Homelessness has been an increasing problem in this country for some time. So has the lack of treatment for the mentally ill. It’s been a Reagan pogrome that we can’t seem to rid ourselves of. Here’s the connection between the two.
Most homeless shelters in the US only take in people who are deemed mentally stable. Most don’t offer anything beyond basic shelter.
Housing programs that also provide psychological services are in the minority, homeless advocates told me. The harsh reality is that most homeless people living in the US who also suffer from serious illnesses like bi-polar disorder, schizophrenia and a host of other mental health disorders, are typically turned away from shelters on a nightly basis.
It’s a disturbing statistic when you discover, as I did, that more than 50 percent of the people living on the streets in the US are mentally ill. Of that number, I was told, less than half are receiving any mental health treatment.
For years, Candace Wood was one of them. I met with Wood in the dining room of Knoxville’s Volunteer Ministry Center (VMC).
For years the mission has dedicated itself to ending homelessness by providing not just housing, but the mental health services that ensures its residents don’t just get off the street, but also have the ability to stay off the street.
Wood told me that before she was connected with the VMC, she was, “wandering around aimlessly.”
“But, I was sick. I was sick because I didn’t take the medicine,” she said.
Wood said she is bi-polar. Since she was previously not on medication and was unable to manage her symptoms. She used to break into buildings to stay warm, hoping it would also get her arrested. Wood said that in jail she knew she’d get the meals and medication she needed.
Ginny Weatherstone is a passionate advocate for Knoxville’s homeless, she’s also the CEO of Volunteer Ministry Center. She says Wood’s story is a common one among the homeless who are also mentally ill.
“Three ‘hots’ and a cot. You get that in jail. For them, jail is their mental health hospital. Jail is their housing,” Weatherstone told me.
I’ve always felt that the Reagan and Bush years were all about punishing the poor, the ill, the elderly, the weak, the young, and the feeble. Statistics show that the wealthy have been doing fabulously since these three presidents reigned. It really is such a horrible statement on our countries’ priorities. How can so many folks be so rich and not give a damn about any one else.
The Rich Have Gained $5.6 Trillion in the ‘Recovery,’ While the Rest of Us Have Lost $669 Billion
It’s no accident.Oh, are we getting ripped off. And now we’ve got the data to prove it. From 2009 to 2011, the richest 8 million families (the top 7%) on average saw their wealth rise from $1.7 million to $2.5 million each. Meanwhile the rest of us – the bottom 93% (that’s 111 million families) — suffered on average a decline of $6,000 each.Do the math and you’ll discover that the top 7% gained a whopping $5.6 trillion in net worth (assets minus liabilities) while the rest of lost $669 billion. Their wealth went up by 28% while ours went down by 4 percent.
It’s as if the entire economic recovery is going into the pockets of the rich. And that’s no accident.
The Sequestration Blues: Part 2 Pete Peterson Creates a Crisis
Posted: February 26, 2013 Filed under: Austerity, Barack Obama, Catfood Commission, Economy, Federal Budget, Federal Budget and Budget deficit | Tags: Astroturf, Deficit Delusion, deficit hawks, Deficit Hysteria, Fix the Debt, Pete Peterson, Simpson-Bowles 13 Comments »
Ben Bernanke joined the chorus of economists concerned about the impact of the sequester on the sluggish recovery. This is not the first time the Fed chair has commented on misguided and dysfunctional Fiscal Policy in our country.
Federal Reserve Chairman Ben Bernanke warned Congress risks slowing the economy by allowing $85 billion in automatic spending cuts to be triggered on Friday, arguing they should be replaced with more deliberate, long-term cuts.
In prepared testimony for the Senate Banking Committee, Bernanke argued the sequester would pose a “significant headwind” to the economic recovery.
“Given the still-moderate underlying pace of economic growth, this additional near-term burden on the recovery is significant,” he warned.Bernanke did not offer an opinion on whether tax hikes should be included as part of a replacement bill, and he did not call for any specific entitlement reforms.
Meanwhile, the White House released reports on how the expected cuts will impact states. This undoubtedly will trigger more Republican whining on how mean the President continues to be to them as they continue their role as economic agents of chaos.
In Kentucky, home of the Senate Republican leader, Mitch McConnell, residents woke up on Monday to news articles like these: Widespread government spending cuts that begin on Friday will cost 21,484 jobs in the state. A construction project at Fort Knox will come to a halt. Three airports may endure partial shutdowns. Nearly $12 million in grants to public schools would be cut, putting at risk the jobs of 160 teachers and aides. More than 1,000 children would lose access to Head Start.
The White House released warnings for every state on Sunday in the hope that angry voters would besiege Republican lawmakers like Mr. McConnell and the House speaker, John Boehner, to stop the $85 billion in cuts, known as a sequester. President Obama wants to replace the sequester with a mix of tax increases on the rich and less damaging spending reductions. Republicans say they won’t consider any proposal that isn’t all cuts, so the sequester is all but certain to begin this week.
There’s a fairly good list of the types of spending items that will be subject to cuts at the Bipartisan Policy Center.
Setting aside the magnitude of the reductions, the most difficult aspect of both the defense and domestic cuts is that they will be made across the board to all non-exempt government spending regardless of programs’ merits or demerits.*** The reductions designed by law are executed at the Program, Project & Activity (PPA) level of the federal budget, sometimes defined in appropriations bills and which often includes very granular categories of expenditures, such as “two Virginia Class Submarines” or “salaries and benefits” of a particular agency.
Absent a new law passed by Congress, the president has little ability to spare one type of spending and cut more from another. This creates uncertainty in both the public and private sector because there remains much to be determined about how PPAs will be defined by agency administrators and how the cuts will be implemented. This inability to plan is already acting as a drag on economic growth.
Furthermore, the immediate and across the board nature of the cuts, along with their magnitude concentrated in a seven-month period, will impair economic growth as the year progresses. At BPC, we estimated last year that the sequester would reduce 2013 gross domestic product (GDP) growth by half a percentage point, and would cost the economy approximately one million jobs over the next two years. More recent estimates released by the CBO and Macroeconomic Advisors have roughly confirmed these projections.
Given all of this, you would think that most congress critterz would want to avoid the sequester. However, there’s that same group of tea party crazies that are so disconnected from an evidence-based reality it appears congress will tank the economy rather than develop a cogent Fiscal Policy related to economic theory and the state of the economy itself.
The White House strategy on the sequester was built around a familiar miscalculation about Republicans. It assumed that, in the end, they would be reasonable and negotiate a realistic alternative to indiscriminate cuts. Because the reductions hurt defense programs long held sacrosanct by Republicans, the White House thought it had leverage that would reduce the damage to the domestic programs favored by Democrats.
It turns out, though, that the defense hawks in the party are outnumbered. More Republicans seem to care about reducing spending at all costs, and the prospect of damaging vital government programs does not seem to bother them. “Fiscal questions trump defense in a way they never would have after 9/11,” Representative Tom Cole, a Republican of Oklahoma, told The Times. “But the war in Iraq is over. Troops are coming home from Afghanistan, and we want to secure the cuts.”
Cuts this draconian have no place in a tottering economy. But, realistically, the only way to break this standoff is for the cuts to exact their toll on daily life, causing Republicans to face pressure from the public to negotiate an alternative plan with higher revenues in March as part of talks to finance the government for the final six months of the fiscal year.
It’s difficult to believe that so many folks can be so misguided about the need to drastically cut the budget. Read the rest of this entry »
The Agony and the Idiocy
Posted: February 16, 2013 Filed under: Catfood Commission, Domestic Policy, Economy, Federal Budget, Federal Budget and Budget deficit, We are so F'd | Tags: austerians, deficit hawks, Joe Scarborough, Mourning Joe, Paul Krugman 38 Comments »Some one needs to take the shovel away from Joe Scarborough. He’s about ready to wind up in Siberia with that hole he’s digging himself. I’ve 
never seen such obsessive compulsive self-destructive behavior. The man cannot admit he’s wrong and knows nothing about economics. He also doesn’t appear to know the difference between an economist and a lawyer and a foreign policy expert. I expect that one of these days he’ll have heart failure then go to his Politico blog to instruct another lawyer on how to do his surgery correctly. Maybe, he’ll start giving lectures on the origins of the universe to Neil Degrasse Tyson next.
Who knew one man could become apoplectic convincing every one he wasn’t beaten up in a one-sided match of wits by Nobel Prize Winning Economist and ubernerd Paul Krugman over 2 weeks ago? He’s written the second of two “I know you are, but what am I?” blog threads at Politico in two days. What Scarboroughs’s become is your run-of-the-mill internet troll who is now blog stalking Dr. Krugman. Only “Tiger Beat on the Potomac” would continue to give this pathetic man a platform for what looks like a developing psychological disorder. We thought he’d over done it on Nate Silver and the presidential poll analysis. But, nope, he’s back and convinced he knows enough about investment and econometrics to analyze the whims of investors.
Yesterday’s Scarborough rant was so bad and so wrong, I actually stepped into it. Scarborough relentlessly insists that Krugman is wrong and that all the rest of us economists think he’s wrong too. To prove his point and to try to get back for being shown up on his show, Mourning Joe used an article written by Princeton economist and Paul Krugman colleague Alan Blinder. The only problem is that Blinder is basically saying the same thing Krugman’s been saying all along. Scarborough not only proved Krugman’s point, he totally missed the point–and the headline–of the Blinder article as well as ascribing the article to the wrong publication. Mourning Joe must’ve read only a sentence and ignored the rest. Does that first sentence not read “Today, there is no deficit crisis” or do I need to up my script for my reading glasses?
Today, there is no deficit crisis. Tomorrow, there will be no deficit crisis. But in ten years, we will have a massive problem of exploding health care costs. Now that’s a crisis to worry about.
But, to Mourning Joe, this means:
But the same could not be said of a fabulously misleading Business Insider post that claimed to list 11 economists who shared Krugman’s debt-denying views. Never mind the fact that most of the links provided actually undercut Krugman’s reckless position and supported my view that the most pressing fiscal crisis is not next year’s deficit but next decade’s debt.
The Business Insider link to an Alan Blinder piece was particularly supportive of the “Morning Joe” panel’s view. Blinder, a former Fed vice chairman and Princeton economics professor, warned of “truly horrific problems” caused by long-term debt, health care costs and interest on the debt. Paul Krugman’s Princeton colleague even shared my conclusion that the coming Medicare crisis will be so great that Democrats won’t be able to tax their way out of it.
Far from supporting Mr. Krugman’s extreme position, the link to Professor Blinder’s New Yorker article undercuts his Princeton colleague’s exaggerated “In-the-end-we’ll-all-be-dead” approach to U.S. long-term debt.
Then he added a short list of noneconomists--including Ed Rendell who is paid lobbyist for deficit hawk group Fix the Debt associated with Simpson & EB who make about $40,000 a speech as travelling austerians–as proof that all economists think Krugman is as extreme on economics as Wayne LaPierre is on gun safety laws. Considering Krugman’s name resides on a well-known trade model, he’s published in just about every prestigious peer-reviewed journal possible, and he’s got one of the best-selling set of text books in the country right now, I’d say Joe just won’t admit he’s way out of his league. Krugman calls Scarborough desperate. Frankly, he gone way beyond that to pathetic to me.
First up, the sad story of Joe Scarborough, whose response to my anti-austerian appearance on his show has been a bizarre campaign to convince the world that absolutely nobody of consequence shares my views. Why is this bizarre? Because while I could be wrong about macroeconomics (although I’m not), it’s just not true, provably not true, that I’m alone in arguing that the current and near-future deficit aren’t problems.
I actually wrote about all of this over two weeks ago (1/30/2013) when the incident first happened, so it seems all deja vu to be at this again. But let me tie this to a bigger problem again. Hillary Clinton left the Benghazi hearings uttering something profound. These hearings were some of the more bizarre things I’d ever watched until the Hagel hearings started and the obsession with conspiracy theories went nuclear. Clinton said some ‘‘just will not live in an evidence-based world’. This includes Joe Scarborough who thinks his “analysis” in his latest little short blog blurb shows Krugman as being wrong, wrong wrong. This is what he thinks is a “TA DA”! moment. I would expect better analysis from Macro 101 students. I would also expect any student in basic statistics or econometrics to have a hey day with his methodology which doesn’t even broach the high school level. But, he’s real proud of it and thinks it puts Krugman in his place.
Investors may be growing skittish about U.S. government debt levels and the disordered state of U.S. fiscal policymaking.
From the beginning of 2002, when U.S. government debt was at its most recent minimum as a share of GDP, to the end of 2012, the dollar lost 25 percent of its value, in price-adjusted terms, against a basket of the currencies of major trading partners. This may have been because investors fear that the only way out of the current debt problems will be future inflation.
More troubling for the future is that private domestic investment—the fuel for future economic growth—shows a strong negative correlation with government debt levels over several business cycles dating back to the late 1950s. Continuing high debt does not bode well in this regard.
I can tell you that the minute all the econ and finance professors who blog get a hold of this, there will be laughter so loud that it will leave the blogosphere and escape to a permanent home in the universal annals of Pathos. Frankly, I can already see using this in a first level, midterm statistics class, corporate finance class or economics class. How many wrong things can you point to in this analysis in just 45 minutes? Go!
Joe probably eyeballed domestic investment numbers and debt levels then labelled it correlation so he can jump an infinite number of sharks to go AHA!!!! GOTCHA PROFESSOR MORIARTY errr Krugman!! He also appears to be blissfully unaware of Fed policy concerning the dollar which basically sets the supply of our currency and the fact that supply interacts with the demand for our currency to set exchange rates. Oh, and the dollar’s been up against the major currencies (especially the EURO) since Dubya left office, so one of his arguments is just factually wrong. The USD has been up against the Yen for well over a year and then up then flat against the Pound Sterling for years so I’m not sure which currency he’s worried about in that basket. It’s even been flat against the Cayman Islands Dollar which I’m sure is more of interest to him than anything else. It’s way down against the Chinese Yuan but then, I wouldn’t consider that a problem at all.
I’m tempted to go there and there and all the places I could go with this, but I won’t because most of you probably don’t want a stats lecture and I don’t have all day. Let me just say that there are a lot of factors that drive investment, which is the least logical component of the national income accounts; and to single out one possible factor without controlling for any of the other factors is a fool’s errand. It shows complete ignorance of investment, finance, and economics so we can add a few more things to the list called what Joe doesn’t know. Actually, worse than that is that he appears to have gotten this blather from an anonymous “senior economist” from the Rand Corporation. Is he misquoting another economist or did some one actually write this for him? Worrying either way!!
Joe, however, is more importantly a symptom of the much bigger problem identified by our former Madam Secretary. We have an entire political party that insists it’s right when clearly, the overwhelming amount of evidence says its wrong. For this analysis, I’m closing with something by Kevin Drum who occasionally can find the nut. We deserve a better press. We deserve better than Joe Scarborough littering up the air waves under the guise of “news” instead of misguided memes and propaganda.
It seems to me that something has happened over the past three months: the nonpartisan media has finally started to internalize the idea that the modern Republican Party has gone off the rails. Their leaders can’t control their backbenchers. They throw pointless temper tantrums about everything President Obama proposes. They have no serious ideas of their own aside from wanting to keep taxes low on the rich. They’re serially obsessed with a few hobby horses — Fast & Furious! Obamacare! Benghazi! — that no one else cares about. Their fundraising is controlled by scam artists. They’re rudderless and consumed with infighting. They’re demographically doomed.
Obviously these are all things that we partisan hacks in the blogosphere have been yapping about forever. But the mainstream press, despite endless conservative kvetching to the contrary, has mostly stuck with standard shape-of-the-world-differs reporting.
Recently, though, my sense is that this has shifted a bit. The framing of even straight new [sic] reports feels just a little bit jaded, as if veteran reporters just can’t bring themselves to pretend one more time that climate change is a hoax, Benghazi is a scandal, and federal spending is spiraling out of control. It’s getting harder and harder to pretend that the same old shrieking over the same old issues is really newsworthy.
This brings me back to Boston Boomer’s Valentine’s Day morning rant based on a phone discussion we had the night before. Why-oh-Why am I writing about this again? Why-oh-why can’t we put this kind of nonsense to bed like all sane people who know the earth is not flat, an apple will fall to the ground if dropped from a tree, and if you every one stops spending and only a few families have decent incomes, the economy will contract and say stay contracted? Don’t folks like Scarborough and the AEI know we buried Say’s Law Failed Hypothesis a long time ago? (Kinda like we buried that zombie Laffer curve! But some folks just want to believe the universe revolves around the earth and the entire set up is only a few thousand years old. Hmmm, like Mark Rubio.)
I’m not sure that last question was rhetorical or not, but hey, it’s a thread and there’s a discussion, so discuss amongst yourselves …
Here’s the topic:
Joe Scarborough, pathetic or desperate? or Why oh Why can’t we Have a better press corps? Joe Scarborough edition
or The Deficit Hawk Delusion: What the Krugman-Scarborough Slugfest Is Really About?
DISCUSS!!!
Friday Reads: Life’s Labor Lost
Posted: February 15, 2013 Filed under: Economy, morning reads, unemployment | Tags: EITC, minimum wage, SOTU, unemployment 61 Comments »
Good Morning!
I think I’ve mentioned that I’m not a labor economist. I’m a financial economist. However, it’s hard to get through any econ program with out learning something about the labor markets given that it’s one of the most basic of all markets. I wanted to talk about the increased minimum wage proposal in the President’s SOTU address.
You’ll probably hear quite a bit about how minimum wages create unemployment. This is true under specific conditions. The minimum wage must be below the going wage or what we call the equilibrium or clearing wage so that it is ‘binding’ or actually creating an excess supply of job seekers for that wage and less jobs than would be available at the clearing wage. You can look at the graph of the US below and see that in many states, the proposed Obama increase to the minimum wage is lower than the going wage in many states. The poorest states–mostly in the south and middle of the country–are the ones with the lower wages.
However, the basic 101 econ labor market conditions, assumptions and model are very simplistic. All of these things impact the outcome and can determine if the minimum wage increase creates any excess workers. Labor economists that look at the real world have found some additional things about minimum wages that suggest that minimum wage can benefit the economy at large and unemployment at large. They can also help create efficiencies in unexpected places, which is always good for markets.
I’m going to try to give you some background from the popular press, scholarly articles, and a conservative magazine where economists explain why increasing the minimum wage can be good for the economy. Actually, there’s so much good rationale that even Walmart lobbies congress for increases. That probably will surprise you, but it’s pretty simple. Minimum wage workers are Walmart shoppers. Giving them more income turns them into customers. They don’t have any leftover money so they basically spend all they get. This is good for Walmart. This isn’t true for richer folks. They tend to sit on their money and it goes to places that can take time to work through our economy if it actually goes to our economy and not some place else entirely.
So, let me first start with a New Yorker article called “The Case for a Higher Minimum Wage”. This is, of course, not the scholarly arguments. However, there’s some good background information in the article to get us situated with the stylized facts. Unlike House Republicans and Joe Scarborough, people that actually want to know abut things rather than opine through their bungholes love them some stylized facts.
While the labor economists and econometricians are still arguing about which of their many studies can be relied upon, there are quite a few things about minimum wages, and their impact on the economy, that we know for sure. Taken together, these things amply justify raising the minimum wage, as President Obama called for in his State of the Union address.
The first statement we can make without fear of contradiction is that, at $7.25 an hour, the current minimum wage is pretty low. In nominal dollars, it’s gone up quite a bit over the past twenty-five years. In 1978, it was $2.65; in 1991, it was $4.25. But these figures don’t take into account rising prices, which eat away at purchasing power. After adjusting for inflation, the minimum wage is about $3.30 less than it was in 1968. Back then—forty-five years ago—the minimum wage was $10.56 an hour, according to a very useful chart from CNNMoney.
We also know that the U.S. minimum wage is low compared to its counterparts in other advanced countries. In France and Ireland, for example, the minimum remuneration level is more than eleven dollars an hour. Even in Great Britain, which is usually regarded as a country with a flexible, U.S.-style labor market, it is close to ten dollars an hour. Another informative chart, this one from Business Insider, shows that the U.S. minimum wage is comparable to ones in places like Greece, Spain, and Slovenia—countries where G.D.P. per capita and labor productivity are markedly lower than here in the United States. We have an advanced economy but a middle-level minimum wage.
A second important and (largely) undisputed finding is that there is no obvious link between the minimum wage and the
unemployment rate. During the nineteen sixties, when the minimum wage was raised sharply, unemployment rates were sharply lower than they were in the nineteen eighties, when the real value of the minimum wage fell dramatically. If you look across the states, some of which set a minimum wage above the federal minimum, you can’t see any sign of higher rates leading to higher unemployment. In Nevada, where the national minimum of $7.25 an hour applies, the jobless rate is 10.2 per cent. In Vermont, where the minimum wage is $8.60 an hour, the unemployment rate is 5.1 per cent. What these figures tell us is that other factors, such as the overall state of the economy and how local industries are doing, matter a lot more for employment than the level of the minimum wage does.
There are, in fact, many things that impact how the level of the minimum wage will impact an economy. Some economists have found that a “properly functioning minimum wage” can actually improve labor flows in a market. Lee & Saez (2010) show under which conditions this can happen. This link goes to a theoretical paper so if calculus is not you’re thing, you may want to take my word for it. I’m going to show you the technical result as well as the authors’ story that is much more intuitive so you get an idea of how economists look at these things. This is from the paper’s introduction and conclusion which are the parts without the calculus!!
We show that a binding minimum wage is desirable as long as the government values redistribution from high-to low-wage workers, the demand elasticity of low-skilled labor is finite, the supply elasticity of low-skilled labor is positive, and most importantly, that the unemployment induced by the minimum wage is efficient, i.e. unemployment hits workers with the lowest surplus first. The intuition is extremely simple: starting from the competitive equilibrium, a small binding minimum wage has a first order effect on distribution but only a second order effect on efficiency as only marginal workers initially lose their job.
This is from the employer’s view point. It basically says they let go of their worst employees first so they really don’t lose much. Also, it implies it’s probably not a large number that are released. The problem is that this doesn’t really look at the increased number of people that might enter the work force to get at the higher wage. This is part of the excess worker phenomenon as people that wouldn’t be in the market for the lower wage will enter the market if the wage is higher. Therefore, more people will be looking for jobs than there will be jobs available. However, this isn’t as big of a problem as job losers for society as a general rule. It just makes the numbers appear worse.
The second part of the paper considers the more realistic case where the government also uses taxes and transfers for redistribution. In our model, we abstract from the hours of work decision and focus only on the job choice and work participation decisions. Such a model can capture both participation decisions (the extensive margin) as well as decisions whereby individuals can choose higher paying occupations by exerting more effort (the intensive margin). In that context, the government observes only earnings, but not the utility work costs incurred by individuals.1
In such a model, we show that a minimum wage is desirable if unemployment induced by the minimum wage is efficient and the government values redistribution toward low-skilled workers. The intuition for this result is the following. A binding minimum wage enhances the effectiveness of transfers to low-skilled workers as it prevents low-skilled wages from falling through incidence e ffects. Theoretically, the minimum wage under efficient rationing sorts individuals into employment and unemployment based on their unobservable cost of work. Thus, the minimum wage partially reveals costs of work in a way that the tax system cannot.
This is an interesting result since it basically says that it’s a more efficient way of giving poorer folks incomes by keeping the most efficient ones in the labor force instead of being unemployed and relying on government programs. Their model argues that a minimum wage efficiently rations ‘out of work’ benefits. So, in this case, yes it creates some unemployment, but generally this means the workers who are the most ‘deserving’ of the job stay in the job and those that aren’t can fall into the safety net and be retrained or schooled to improve their prospects.
One of the primary results of a paper by Dube et al (2o12) is estimating the decrease of what we call “churning” or what you probably know as job-hopping. This behavior costs employers a lot of money since the initial employment and training periods can be expensive for even the lowest wager earners. Reducing churning means less of these expenses overall and basically coverage of the increased wage. So, in this case, the minimum wage makes the employer think about the total wage bill and not just the portion related to hourly work.
Here’s one of the more interesting set of arguments from the conservative point of view. This is the idea that by providing a good working wage at the bottom wage earners, you stop the problem of a potential ‘college graduate’ bubble. Since the majority of jobs in this country still don’t require a college degree, people will be more likely to work jobs and not over-educate themselves. The author also argues that the kinds of jobs that tend to be minimum wage jobs are not out-sourceable so improving the lot of these folks improves a lot more than just the people in the jobs. Minimum wage jobs tend to be service jobs and the benefits of the incomes and the jobs themselves will stay in the country regardless of the higher wage. We again see the argument that most economists make about ‘trickle-up’ economics. Giving more income to the lowest wage earners actually creates a stimulus because they spend their money and there are a lot of them.
Although the direct financial benefits to working-class Americans and our economy as a whole are the primary justifications for the proposal, there are a number of subsidiary benefits as well, ranging across both economic and non-economic areas.
First, the net dollar transfers through the labor market in this proposal would generally be from higher to lower income strata, and lower-income individuals tend to pay a much larger fraction of their income in payroll and sales taxes. Thus, a large boost in working-class wages would obviously have a very positive impact on the financial health of Social Security, Medicare and other government programs funded directly from the paycheck. Meanwhile, increased sales tax collections would improve the dismal fiscal picture for state and local governments, and the public school systems they finance.
A final argument for using a minimum wage is that even though it tends to be less efficient and more costly than just supplementing the incomes of low income earners, it tends to be politically easier to get an increase through congress than a subsidy.
Does raising it improve the plight of the worst off, at a reasonable price?
A lot depends on your definitions, but economist Adam Ozimek makes a smart point. According to a 2007 study by the CBO, an increase in the minimum wage to $7.25, like that eventually passed that year, would increase wages by $11 billion, of which $1.6 billion went to poor families.
By contrast, increasing the Earned Income Tax Credit for large families (as happened in the stimulus bill) and for single people would cost $2.4 billion, of which $1.4 billion would go to poor families. The EITC option costs one fifth as much to society but does about as much good for poor families. That suggests that if you want to help families escape poverty, wage subsidies are a more cost-effective option than the minimum wage.
Oddly enough, the conservatives are less interested in the net savings, than the process of doing this, so they prefer minimum wage increases to the EITC option. This means Boehner should be happier than he is with this proposal.
Furthermore, as large portions of the working-poor became much less poor, the payout of the existing Federal Earned Income Tax Credit (EITC) would be sharply reduced. Although popular among politicians, the EITC is a classic example of economic special interests privatizing profits while socializing costs: employers receive the full benefits of their low-wage workforce while a substantial fraction of the wage expense is pushed onto the taxpayers. Private companies should fund their own payrolls rather than rely upon substantial government subsidies, which produce major distortions in market signals.
So, I hopefully didn’t overwhelm you with too much stuff over coffee, but I would like to remind you that this is basically the mornings read post. So, since I’ve run out of space, it’s now your turn to share the other things. Oh, and it’s okay to ask questions or tell me that something confuses you. I’m assuming you’re not a labor economist either. Again, there’s a lot of controversy and a lot of different circumstances and assumptions around all these models. But, it should let you know that increasing the minimum wage can be good policy for a variety of reasons even though it might impact the number of people looking for or working at those jobs.
What’s on your reading and blogging list today?
Sima
bostonboomer
dakinikat
ecocatwoman
fiscalliberal
grayslady
JJ Lopez Minkoff
mablue2
NW Luna
peggysue22
quixote
Mona (aka Wonk the Vote)
Recent Comments