Races to the Bottom are Just That: Why Job Quality Matters

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120 Responses

  1. Avatar Damon says:

    Given the US now has over 220 Trillion Dollars in obligations, has been printing money at the rate of trillions a year, and is in debt up to it’s eyeballs, MORE spending would seem be digging deeper into the hole.

    And what are we going to do when it all comes crashing down?Report

    • Avatar Morat20 in reply to Damon says:

      I find all those numbers hilarious. 220 trillion in obligations? Where’s that coming from? Printing trillions a year in cash? Where’s THAT number coming from?

      Inflation is under 1.5%, the deficit has shrunk to an ignorable fraction of the US’s economic growth….Report

      • Avatar Jesse Ewiak in reply to Morat20 says:

        The “obligations” number is counting up basically all entitlement spending for the next century and coming up with a big number to scare people.

        For example, right now, I don’t make a ton of money. So, if I said, I have literally millions of dollars in obligations in my life (which is true assuming I live ’til 80 and ya’ know, have to pay water bills and mortgages and stuff), am in debt up to my eyeballs (again, assuming my current salary never grows for the next 40 years), and am printing money (OK, unless I use a really bad credit card analogy, this one doesn’t work).

        Yeah, we’ve got trillions of dollars in obligations. We’re also going to take in trillions of dollars in tax revenues over the next century.Report

        • Avatar North in reply to Jesse Ewiak says:

          Basically yeah. I am of the opinion that 2011 basically killed most of the power of the deficit hawks.Report

          • Avatar Jesse Ewiak in reply to North says:

            It may have killed their power largely in the Democratic Party for now (even though they’ll come back the moment an even moderately left-leaning Democrat loses), but every Republican’s economic plan is basically cut the welfare state to the bone, cut taxes on rich people, and increase the military budget, and there’s still a 25-30% shot that Hillary loses, either due to campaign incompetence, bad luck, or ya’ know, she secretly was selling State Department secrets to Putin or whatever the conspiracy theory of the week is.Report

            • Avatar North in reply to Jesse Ewiak says:

              Yeah I agree with your analysis here generally. That said the I’m of the opinion that the GOP has a serious albatross around their neck with regards to their attitude towards fiscal policy. It’s gonna take a lot of obfuscation on their part or some serious mistakes on HRC’s part (I really hope not. I honestly do think she’d be a decent President)Report

              • Avatar Jesse Ewiak in reply to North says:

                Well, part of the problem is that people literally don’t believe how extreme the modern GOP is on economics (http://nymag.com/daily/intelligencer/2012/07/how-obamas-allies-are-defining-romney.html), (http://www.nytimes.com/2001/12/21/opinion/a-no-win-outcome.html) and that politicians in America believe their constituencies are much more conservative than they really are, (http://www.thewire.com/politics/2013/03/politicians-vs-constituents-charts/62730/), so there’s a feedback loop where the GOP isn’t really hurt by being extreme on economics, so they don’t moderate, and then, eventually when they do win (like they did in ’10 and ’14), they’ll believe they don’t need to moderate at all.

                Yes, I believe a well-informed populace would force the GOP to a more center-right position, but when people literally don’t believe that the stated policies of the party, that’s kind of an issue.

                I guess it comes down to that I’m a bit more pessimistic about the GOP is ever going to moderate itself when it continues to win midterm victories, lots of state legislatures, and come dangerously close to winning Presidential elections despite moving farther and farther to the right because a large chunk of their voting base still thinks their voting for Jack Kemp.Report

              • Avatar North in reply to Jesse Ewiak says:

                Well they already know they can’t enact their agenda is the thing. That’s why they can’t get their budgets or other proposals down in solid math. Once they cut the taxes the way they want and lard up the defense budget the way they want they look at what’s left and realize they’d be electoral toast so then they sortof mumble and pile *’s and “assume increased revenue because unicorns” and stuff.Report

      • Avatar Saul Degraw in reply to Morat20 says:

        @morat20

        Do you know all those ads on the Internet that mention of the CIA’s Economist forecasts a 20 year Depression….Report

      • Avatar Damon in reply to Morat20 says:

        220 Trillion is the present value of all obligations the congress has made….ie it’s the current dollar amount that you’d have to invest to have enough money to pay off the debt at the end of the term out in the future. When you look at the amount we take in in the form of taxes, etc., we’re deep in the hole, and we’ll never get out, since obligations grow at a rate greater than the revenue taken in does. @jesse-ewiak..that’s the part you should pay attention to. The Treasury has, essentially, agreed with the amount. You may equate it to the Greek problem because one day, lenders are going to decide we can no longer service even the interest on the debt we have. Quite likely when the dollar no longer is the reserve currency of the world.

        “Printing trillions of cash”. That’s called quantitative easing. You know where the fed creates money and uses it to buy crap assets and loans?Report

        • Avatar Jesse Ewiak in reply to Damon says:

          As a nation, we’ve been “deep in the hole” since day 1. Out of 250 odd budgets, I think we haven’t had a deficit in like, five.

          Of course, the difference between the Greeks and us is ya’ know, we control our own currency and even if it stops being the worlds reserve currency (which means you’re betting on the Chinese allowing their currency to be a reserve currency _or_ the Euro gets their act together), we still have a multi-trillion dollar economy backing it up instead of some nice beaches and an old building or two like the Greek’s do.Report

          • Avatar Brandon Berg in reply to Jesse Ewiak says:

            While the federal fovernment has run deficits almost every year, they’ve often been small enough to allow net federal debt as a percentage of GDP to decline. It was over 100% of GDP right after World War II, and was 35% as recently as 2007. Since then it’s more than doubled, to 74% last year.

            Much of that is due to the recession, which resulted in lower tax revenues and one-time stimulus spending, plus increased welfare spending, but there are also significant structural factors, most significantly the retirement and increased life expectancy of the Baby Boomers, that will cause this to be an issue for the foreseeable future.

            Yeah, I know your solution is to jack up taxes on people who make more money than you, but there are very good reasons, both theoretical and empirical, to believe that high government spending reduces long-run growth rates. Keynesian stimulus is for closing the shortfall between potential GDP and actual GDP during a recession, not for increasing potential GDP, which is where long-run growth comes from.Report

            • Avatar Damon in reply to Brandon Berg says:

              In addition, if you look at the federal gov’ts income from taxes/all sources as a percentage of the gdp, it’s historically been very consistent, REGARDLESS, of the income tax and other rates. IIRC, it’s been around 35%, so changes in the rates don’t generate much new revenue because, surprise, people modify their behavior to pay less in taxes.Report

              • Avatar Brandon Berg in reply to Damon says:

                Federal revenues topped out a bit over 20% of GDP in 2000 (20.4%, IIRC, and there may have been one year when it was slightly higher). Historical average since the 60s is 17-18%, I think. You may be thinking of total (federal + state + local) spending, which is in the high 30s.Report

              • The Tax Foundation has had total taxes (federal, state, and local) in a narrow range of 28-32% of GDP for decades, split roughly two-thirds federal and one-third for the others. Spending is higher than that due to the federal deficit, of course. With a handful of exceptions, state-plus-local taxes fall into a narrow range of about 9-12% everywhere. The exceptions have generally found a way to tax people in other states heavily: Wyoming by taxing coal, Alaska by taxing oil, Florida and Nevada by taxing tourists.Report

            • Avatar North in reply to Brandon Berg says:

              You’re leaving out the part with that commie Obama decided to put all of Bush W’s war bills on the budget instead of hiding them in a closet.Report

      • Avatar j r in reply to Morat20 says:

        Inflation is under 1.5%, the deficit has shrunk to an ignorable fraction of the US’s economic growth….

        You’re right about inflation, but the deficit part… well, I guess that you haven’t seen the latest growth numbers.Report

    • Avatar Kim in reply to Damon says:

      The words “Reserve Currency” mean nothing to you, do they? ;-P
      Our debt to China is part of the reason they aren’t attacking us.Report

  2. The key question is at the end of your OP. What, indeed, are the solutions? I might object that it seems to apply that I think “the solution to the inequalities of Capitalism” is “more Capitalism,” in part because I don’t think I could define capitalism, and in part because I have consistently advocated for state-level welfare supports and some form of public health insurance (I settle on Obamacare, but would prefer something like single payer, public option, or at least something quasi-privatized-but-also-quasi-non-profit like the Swiss system). I actually have more reservations about the GBI, including whether is will be sufficient enough and whether is will be just a more robust version of the EITC, but with most other benefits cut. But with certain conditions, I would support GBI.

    Also, you suggest that the cost of food, clothing, and shelter doesn’t go down. I dispute that claim, at least as it applies to food and clothing Shelter might be a different issue, both because of the legacy of housing discrimination, poor housing infrastructure (a huge problem from WWII through ca. 1970), and schemes like rent control probably have conspired to keep prices high. And for all I know, maybe shelter is inherently bound to be more expensive, especially as population increases.

    As for the second bill of rights, here’s my feelings on it, quoted from the last thread:

    “1. Employment, with a living wage. To me, that sounds like a guaranteed basic income. For if not everyone has a job (which will happen at least occasionally, as FDR well knew) then the state, or someone, is guaranteeing the income, either through outright grants or through a system of benefits (food stamps, housing subsidies, etc.). That, I understand, is what “universal employment guarantees” mean.

    “2. Food, clothing, leisure. I support all three. I personally believe that any safety net system (or GBI) needs to be able to provide for a certain amount of leisure. It should be more than bare subsistence.

    “3. Farmers’ rights to fair income. “Fair” is a term of art. I’m more inclined to think this plank in the new BofR is mostly a sop to FDR’s rural constituency. If ensuring a “fair income” to farmers means increasing the cost of food to people, then count me out.

    “4. Freedom from unfair competition and monopolies. It depends on what is meant by “unfair” and “monopolies.” If “unfair” means a business is charging less than another business or is open longer than customary hours, then I say, it’s okay to be unfair. If “unfair” means fraudulent or prupsoefully misleading advertising, then count me in. For monoopolies, it also depends on the definition. By one definition of monopoly (state-granted and -enforced privileges that ensure entities a specially protected position in the economy), NLRA unions and farmer coops might count as monopolies, which is probably not what FDR intended. By another definition of monopoly (a business that’s too big for Americans’ comfort), it probably applies to Walmart USA, but not 50 separate different Walmarts (Walmart of Arkansas, Walmart of Ohio, Walmart of Illinois), similar to the Standard Oil solution. I’m not too much on board.

    “5, 6, 7. Pretty much on board, with the caveat that the devil is, as always, in the details. The “right of families to a decent home”? It depends on whether a house meets the only definition of “decent.” Social security? I’d prefer a less regressive system than the FDR is responsible for. But if that’s all a that’s on the table, I’ll take it. Medical care? Like ssa, I’d prefer a less regressive system than Obamacare, but since that’s probably the best possible, I’ll take it. (And I’ve defended it ever since it seemed likely to pass.)

    “8. On board, but it depends on what we mean. I think people have a right to access to a basic education and help in advancing that education. I’m not sure I’d translate it into a “right” for a college education.

    “Now, here are my concerns about this “second bill of rights.”

    “Calling some of these things “rights,” which mostly are “rights to” things, aka freedom from fear and freedom from want, could imply a positive obligation that might be oppressive to some. If someone wants to work a job that the state deems as not “a useful and remunerative job in the industries or shops or farms or mines of the nation,” that could be bad for that person. My objections to “unfair” above also fall into this category about positive obligations. The NIRA also called for codes of fair competition, and when people champion the New Deal, they usually don’t mean the NIRA. (When I’ve criticized it elsewhere in the context of your saying you like the New Deal, I seem to recall you correcting me that you’re more supportive of things like NLRA, SSA, and FLSA.)

    “Another concern is how to arrive at these goals. My OP is mostly about #1, although #1 implicates, for example, SSA and medical care inasmuch as those are employer (and employee) contributed mandates. In my heart of hearts, I’d prefer a system that grows jobs in the hope that more jobs will empower more people. Others might prefer regulating the jobs available so as to ensure that those jobs that do exist, meet minimum standards. Despite what I say in the OP, I have more sympathy for that latter position than you might think.”

    [Edited to add the words “I’ll add to what I wrote there:”] Finally, as to whether that’s doable in the US. Politically, I’m not so sure. The plan is, as you say, 71 years old, and hasn’t been implemented yet. Steps have been taken: Medicaid, Medicare, Obamacare; expanding FLSA protections; expanding AFDC (before it was “reformed” in 1996); and a huge interjection of government money into the economy to subsidize massive military spending that seems to have had the side effect of a robust economy.Report

    • Avatar Saul Degraw in reply to Gabriel Conroy says:

      The “more capitalism” swipe was more at times when Very Serious People (with lots of money) try and come up with solutions for Income and Wealth inequality, their solutions usually end up being boiled down to “more Capitalism” or “better Capitalism”. Liberals and Leftists generally need to then point out that there is no sacrifice from the Very Serious and Very Rich People who are trying to express concern:

      http://www.slate.com/blogs/moneybox/2014/03/07/google_eric_schmidt_he_has_some_ideas_about_how_to_solve_income_inequality.html

      “The problem is that in the end, Schmidt’s solution to the hardships inherent in globalized capitalism is … more capitalism. He senses a problem and conveniently lands on a solution that doesn’t involve any personal sacrifice on his part, or the part of other well-educated, well-paid folks he might run into on the thought-leader circuit. Which is pretty much why nobody learns much at those events, anyway.”

      Yesterday I read two articles about how the top law firms in America are getting richer and richer and this includes profits per a partner and also how the Class of 2010 from Law School is still struggling on the legal market 5 years after graduation. Many are not working as lawyers or trying to make it as solo practioners. There seems to be a disconnect here to me.Report

  3. Avatar Jesse Ewiak says:

    ” And for all I know, maybe shelter is inherently bound to be more expensive, especially as population increases.”

    http://www.forbes.com/sites/eamonnfingleton/2014/02/02/in-worlds-best-run-economy-home-prices-just-keep-falling-because-thats-what-home-prices-are-supposed-to-do/

    What’s interesting, is that in Germany, they’ve largely been able to stop the massive housing bubble that has risen in other countries – and it largely comes down to

    1. Consistent increases in both the private and public housing supply, along with typical German efficiency in keeping track of how many people live someplace.

    2. Strong renter’s rights, which make it hard to evict them or raise their rent, thus not incentivizing home ownership.

    3. Regulation not allowing home loans unless the buyers have a 20% desposit.

    4. Consumption taxes on home ownership along with tax incentives that push for landlords to maximize available rental properties.

    I’m sure there isn’t perfect, and there are issues, but as the story points out, you can buy an apartment for $55,000 dollars in Berlin. You can’t sleep for an alley that cheap in most of the first tier cities in America.Report

    • Avatar Saul Degraw in reply to Jesse Ewiak says:

      @jesse-ewiak

      I think Berlin is slightly a special case because of all the excess housing from East Germany.

      Though I think it shows a difference in mindsets too and this makes me wonder if there is a strong psychological component to how economics works especially your observation on renter’s rights. Our elites keep says that renter’s rights are bad because they don’t incentivize people to rent because it creates too many obligations on the landlord. I’ve met people in SF who don’t want to rent out their in-law units because of the renter’s rights laws in SF.

      Why can renter’s rights succeed in Germany but in the U.S. are seen as bad bad bad? If economics is universal, then renter’s rights should succeed or fail everywhere by equal measure. I wonder if we renter’s rights fail in the United States because we want them to create bad incentives rather than they actually create bad incentives.Report

      • Avatar Jesse Ewiak in reply to Saul Degraw says:

        I largely agree with you, so I’m going to make a bad joke – one could certainly argue that the housing stock of East Berlin and large portion of the housing stock of Brooklyn, Queens, or parts of Manhattan were at about the same level during the late-60’s to late 80’s. 🙂Report

      • Avatar North in reply to Saul Degraw says:

        I don’t know a lot about German rental regulations but I’d note that we’re talking about two deeply different cultures particularly with regards to attitudes towards home ownership. I actually am sympathetic to the argument that it’s a bad attitude but with as much space as there is in America I don’t see how you can realistically expect to change it. If you don’t change it then that attitude remains the 800 lb gorilla in the room and good luck tackling that.

        My sister owned (with my Mothers financial help) a 3 unit apartment building in Montreal (Quebec is the rent control capital of Canada). When they decided they wished to sell it they ate over a years lost rent in one of the units because the selling price for an unoccupied property is that much higher than for an occupied one. Also they had to literally inspect the unit every day to make certain that no one managed to sneak into it and occupy it long enough to begin claiming it as their residence and paying rent. Rent control is absolutely insane.Report

        • Avatar Will Truman in reply to North says:

          Also, Berlin has had a pretty stable population for almost 25 years in a country with low population growth. NYC and SF, on the other hand, are pulling from a population over three times that of Germany, and a population that is growing more quickly. The levels of competition are different.Report

          • Avatar Jesse Ewiak in reply to Will Truman says:

            Sure, and that explains some of the difference. I have zero doubt.

            But, that doesn’t explain the total difference between $55,000 in Berlin (or $80,000 for a 4 bedroom house in Rhineland as is also pointed out in the article) and $500,000 for a garage in a San Francisco suburb or a couple million for a brownstone in Brooklyn.Report

            • Avatar North in reply to Jesse Ewiak says:

              Correct me if I’m mistaken here but isn’t Berlin A) not located on an island, B)not wedged between the mountains and the sea, C) not facing any water shortages, D) now in possession of half of the city which was basically locked in development stasis up until around the 90’s? Do those not factor in?Report

            • The ultimate question is whether or not the results there can be reproduced over here – with sufficient political will – and how. I’m honestly skeptical for reasons circumstantial (population pull, geography, history) and cultural (the dream of home ownership, etc).

              But I’d be thrilled to see some of the tight-market cities and/or states try different things locally and see if they can pull the costs down. Yay for laboratories of democracy! I’m moderately consistent that way.Report

    • I didn’t read the link because 1) I’m lazy and 2) forbes and my internet browser don’t seem to get along. But the plan, as you lay it out, seems mostly reasonable, except….

      ….(warning, I’m about to say something that just got me in trouble in the other thread and prior threads)….

      ….a robust system of renters’ rights might make it hard for people to find a place to rent, which might impair mobility, which might (depending on how the system of rights is constructed) also give landlords an incentive to shirk their duties. That last “which might” probably depends on how the system of rights is constructed and enforced. To what extent are landlords obligated to maintain repairs and how effectively are those obligations enforced or complied with?Report

      • Avatar North in reply to Gabriel Conroy says:

        Mr. Conroy, I have New York City on the phone for you? Something about multiple layers of administrations and courts and lines and queues and general dysfunction?Report

        • Avatar Jesse Ewiak in reply to North says:

          I agree. Things run much smoother when those pesky renters have no organizational structures to use to stop any kind of action against them.

          It’s the same thing as that “horrible” flowchart that anti-teacher union types used to prove that it was so hard to fire a teacher in New York. And that’s the actual split between social democrats and neoliberals – I think it’s a good thing that firing a teacher or kicking out a tenant isn’t easy for capital/management and that they actually have to prove the teacher has actually done something wrong or the tenant has broken some term of the lease.Report

          • Avatar North in reply to Jesse Ewiak says:

            We’re not talking about breaking a term of a lease here Jesse, we’re talking about “if you want to keep leasing we are obligated to continue renewing your lease for as long as you desire and no we generally cannot increase your rent. Also if you want to rent the place out youself at a markup we still don’t get to have any say in the matter” and other such nonsense. Hell, even Krugman flat out says rent control is economic arsenic.

            Meanwhile if a landlord in a non-rent controlled building just boots a tenant out who hasn’t done anything to break the terms of his lease that landlord’s gonna get his ass sued off; and he’ll lose in pretty short order. Whereas if the landlord in the rent controlled building turns the heat off the tenant gets to go stand in line at renters court to fill out form 1039b and then wait for a few years to see if anything comes of it.Report

    • Avatar Kim in reply to Jesse Ewiak says:

      Jesse,
      Germany doesn’t have first tier cities. Comparing apples to oranges is silly.
      http://en.wikipedia.org/wiki/Global_cityReport

  4. Avatar North says:

    A lot of assumptions abound in this interesting rumination. Some that are passable and some that probably don’t pass muster.

    One of the big ones I object to is Saul’s casual assumption that the app companies can continue to crunch their workers as they have been doing. This runs on an assumption that the economy will be near moribund whereas it has been tepidly growing. Unemployment continues to gradually drop. If we hit another period of economic growth (and it wouldn’t take a lot, more slashes in oil prices, consumers deleveraging to their own satisfaction, the hangover from the great recession easing) the app companies could find themselves crippled for lack of workers; or at least workers of the caliber they need to function. Say what you will of the app company but it requires a certain baseline of technical and educational know-how from its workers this is not a sphere that can make do with badly motivated workers or workers with poor language or technical skills. Basically the pool of workers the app companies are “exploiting” are probably the first picks that the economy will suck up if/when it heats up again. The app companies are in their infancy, this reckoning will be important, it’ll be educational and it will likely result in them scrambling to adapt to lure workers. Also, I’m deeply skeptical that 34% of American workers are freelancers; that sounds like typical San Franciscan center of the earthism*.

    The assumption that the ability for all restaurants to also do takeout now has no benefit for the workers who do deliveries or cook food seems irrational. Seems to me like you’d need to hire a lot more cooks and deliverers to deal with that kind of demand. That’s rather a lot of employed people.

    The line about metro areas collapsing if service workers was so shocking that it rocked me back on my chair. And from a New Yorker at that!! Surely Saul you’ve seen the bridges, tunnels and arteries that flow in and our of that pricey island. They’re not just conveying sacks of svette crap coffee beans and armani suits. Metro areas will pay their service workers to commute if living prices in the city are too high. The higher the prices (and the stronger the rent control), the more they’ll pay for the workers to commute and the further the workers will commute. Collapse? I think not.

    What I find very odd both with your perspective and also with my co-neoliberal Gabriels’ perspective is that you first say that you have either moral qualms or political concerns about the feasibility of simply giving people a very modest basic income (with no or few strings attached) and then you go on to propose some sort of sprawling federal system where people are hired for the purpose of being employed. Presumably such a program would have a division of digging holes and a sister department of filling holes or some such similar nonsense.

    Personally I don’t think we’re “at” GBI yet, or at least I’m skeptical we are. The Swiss are taking a poke at it (bless their pragmatic hearts) and that should be very illuminating. My own suspicion/inclination is to suspect that globalization and, more importantly, automation have a further distance to truck before we get to the economic oomph (and the unemployment crisis political goad) that will be necessary to implement a GBI. Also the American right needs to actually figure out what the fish they stand for and either come up with something new, become libertarians or vanish. The American left (bless ’em, I really do love ’em) I suspect will be around for a lot longer though I am skeptical they’ll become much more coherent.

    But in the immediate future my own inclination is that the current economic crisis’s are mostly made up ones (caused by political forces and some serious economic waves) and that in time we’re going to hit another period of growth that’s going to cause these issues to subside for a while.

    *Which, oddly, I find massively more annoying than New York Center of the earthism. Maybe it’s because I’m half New Yorker (but then that’s upstate New Yorker) but San Franciscans seem so massively self regarding that it makes New Yorkers pale in comparison. Big Hero 6, for instance, was an excellent move but had so much of a vibe of San Franciso centrism that it nearly vanished up its own ass.Report

    • Avatar Jesse Ewiak in reply to North says:

      http://time.com/3268440/americans-freelance/

      “53 million Americans, or 34% of the U.S. workforce, said they engaged in some form of freelance work in the past year, according to a survey conducted by Freelancers Union and Elance-oDesk, an online job market that matches freelancers to employers. The share of freelancers jumped by 3% over the last survey conducted by the U.S. General Accountability Office in 2006.”

      That’s different from 34% of the workforce are primarily freelancers, but still, it’s not a “San Francisco-only” statistic.

      As for the rest, all I’m going to say is that considering 40% of the American population largely believes that welfare of any kind outside of the church or private charity is wrong for people unlike them and another 20% of the population wants to make it as difficult as possible to apply for any kind of social welfare, to discourage people applying for it, I fail to see any future in the short-term where those people are willing to send their tax money to people doing literally nothing.Report

      • Avatar North in reply to Jesse Ewiak says:

        Well Jesse, as I said I don’t think we’re there yet. I’m skeptical we’re even close; particularly in America. Economically I don’t think the slack is present yet both to A) cause unemployment to permanently go high enough to incent the creation of a GBI and B) have the oomph to support a GBI without erupting into wild inflation. Politically/Demographically the GOP and right wing has to kindof sort out what the hell they stand for at the moment. The old Socialcon/Anti-soviet/Libertarian alliance is wrecked and the Republicans alternate between mustache twirling crazy and then frantic obfuscation and distraction to cover up said twirling. I suspect the boomer cohort is going to have to mostly shuffle off the electoral scene before that logjam breaks.

        Also thanks for the link, that’s very helpful. That said as you note people who’re supplementing existing jobs with contracting are a very different beast than someone trying to make a living off it. But I’m with you in thinking that GBI is not anything approaching a short term solution. That said, talking about it, ruminating on it and keeping it out there is useful long term so I do want to continue to bring it up.Report

    • Avatar Saul Degraw in reply to North says:

      I don’t have problems with GBI. I just think FDR’s plan is more palpable to American ideas of indirect welfare. I would gladly accept GBI.Report

    • Avatar Gabriel Conroy in reply to North says:

      North,

      I should clarify that I’m not really a believer in make-work programs. My reservations to the GBI are mostly practical. I do realize that the strong welfare state I support has its disadvantages, one of which is that the state might not get it right.

      Edited to add/ask: Did something I say suggest I believe in make-work programs?Report

    • Avatar Kim in reply to North says:

      North,
      People making the assumption that the app companies WANT to continue to crunch their employees are idiots.
      UBER wants self-driving cars, and they want them now.
      (They’re also hiring, if you fancy moving to Pittsburgh).Report

  5. Avatar Rufus F. says:

    Whenever I talk to people about this issue, particularly online, it seems like the conversation goes something like this:

    Them: So what should we do? You think we should just do away with capitalism?
    Me: Let’s reëstablish the social contract between capital and labor.
    Them: I mean what is the alternative here? You complain, but capitalism is all there is.
    Me: Let’s reëstablish the social contract between capital and labor. It was the root of the American way of life that was a model for the world and it was only really severed by a bunch of fanatics over the last few decades.
    Them: See? You’re not serious!Report

    • Avatar zic in reply to Rufus F. says:

      +1 @rufus-f

      #spaceawesomeReport

    • Avatar Jesse Ewiak in reply to Rufus F. says:

      I hate it when smart people I agree with explain things simpler than I did.Report

    • Avatar North in reply to Rufus F. says:

      It’s an interesting idea. What does reestablishing said social contract between capital and labor entail? Are we talking about companies having more social conscience; some sort of deregulation to make labor organization easier; some sort of regulation to make unionization much easier or axing free trade or something else?Report

      • Avatar Rufus F. in reply to North says:

        A bit of each, save the last, which would probably have more ill effects than good. I’d add in house job training for promising young interns, open-ended employment, pensions, the gold watch at retirement- cultivating loyalty instead of fobbing off administrative power as “flexibility”. Running businesses with an eye towards reliability and steady, incremental growth instead of aiming at immediate high yield short term growth. Basically, acting like what were called “company men” up until the 1980s.Report

        • Avatar North in reply to Rufus F. says:

          It’d be an impressive feat to both accomplish that through policy and also prevent the new old school companies from getting devoured by their competitors like the first generation of companies like them. But big problems call for big ambitions, no doubt about it.Report

          • Avatar Rufus F. in reply to North says:

            Nah, it won’t happen through policy. No doubt about that. Policy makers follow whatever trend is sold to them by catastrophic pronouncements about “Do what I say and the economy doesn’t get hurt!” It’ll happen when this generation of companies has completely screwed themselves into the ground on attracting any talent and someone finally decides to try something different. We’ve got lower to go yet, but the waste of human capital in this era is just amazing. Someone enterprising will figure this out. Here’s a slogan: The way back is the way forward.Report

            • Avatar North in reply to Rufus F. says:

              That seems like a highly probable assessment, well done.Report

            • Avatar Oscar Gordon in reply to Rufus F. says:

              From what I understand (and I don’t imagine I have a good grasp on all the intricacies of it), the relationship between capital & labor could do with a good legislative shakeup. Seems a lot of the laws surrounding unions & labor management, and how they are allowed to interact is hamstringing both labor organization, and preventing labor from evolving to meet the needs & wants of the current workforce.Report

              • Avatar North in reply to Oscar Gordon says:

                Oh yes, there’s a lot of regulation that restricts labor that should probably be done away with.Report

              • Avatar Saul Degraw in reply to North says:

                @north

                Which regulations are you talking about?

                This is what I mean when I express anger at the idea that the solution for the inequalities of capitalism is “more deregulation”, “more capitalism”, or “better capitalism”

                I think Government has a role to come in and prevent abusive and/or discriminatory workplaces. Health and Safety standards in the work place were long fought for and so was Worker’s Comp. Before Worker’s Comp, workers who were injured on the job were shit out of luck because of “assumption of the risk” in taking employment. The 8 hour day was also a long fight and before that, workers did 10, 12, 14, 16 hour shifts with scant time for breaks and the workweek was 6 days, sometimes 7.

                I think people should be specific when they are talking about which regulations could use shaking up.

                A while ago we were discussing whether the Wagner Act helped or hurt Unionization. One OTer mentioned that market anarchy helps unions. My brother mentioned that while it might have been easier to form a Union pre-Wagner Act, it was also just as easy for Management to ignore and break-up Unions. The Wagner Act provides a mechanism that forces Management to recognize Unions whether they want to or not.

                This is why I rebel against Conroy’s suggestion that it is better to create a lot of bad jobs than better or good jobs. We know from history and from current experience that jobs without any regulation can be bad demoralizing and physically brutal. The role of government is not to kowtow to the Job Creators but to say that dignity and decency are important and exist above Business Culture dogma.Report

              • Avatar North in reply to Saul Degraw says:

                I’m far from an expert on union regulation Saul but the basic union narrative is that in the mid last century Unions, Business and Government sat down and reached a detente. Unions got recognition and promises of certain degrees of power and benefits from business. Business got a lot of restrictions on Unions ability to form, strike and otherwise disrupt business. Government got to be the referee.

                In the subsequent decades the businesses that made those promises have either reneged or been devoured by other businesses that don’t have those obligations but Unions remain hamstrung by those regulations. There’re rules around almost everything Unions do now. Since the quid is now long gone I think it’s high time that the pro quos should be scaled back a lot too.Report

              • Avatar Oscar Gordon in reply to Saul Degraw says:

                @saul-degraw

                You are a lawyer, take a look at the scope of labor law and see if there is anything that you think is out of date or is actively hurting the ability of unions to attract membership.

                Right now, the way unions are structured, is something I and many others find not only unattractive, but highly offensive. And not because we object to the idea labor organizing, but because the historical form of the union seems more interested in helping itself first, and workers second. When, in the past, I’ve expressed this perception to others, and wondered why this seems to be the only way we can structure a union in the US, I was told that this is something that is set in labor law.

                So, if the law is preventing unions from evolving and experimenting with new organizational structures that the current & upcoming workforce would find attractive, then the law is in need of adjustment.

                Not deregulation, but better regulation.

                This aligns with @zic ‘s point about how we should not be doing legislate & leave it.Report

              • Avatar Kim in reply to Oscar Gordon says:

                The law’s a red herring.
                If the corporations go global, the labor movement must follow.

                Until we start hearing the words Global Strike more often, labor will continue to be crippled — and children will continue to die.Report

              • Avatar Cardiff Kook in reply to Kim says:

                Kim, an effective strike requires a cartel with barriers to entry.

                Your paradigm is wrong. Workers aren’t competing with employers. Workers compete with other prospective workers for scarce jobs. A global strike is a Marxist fiction.

                Workers cooperate with employers. They compete with other workers to join in the voluntary cooperative endeavor. If we go on strike, our competing prospective workers will gladly take the job, while laughing at our silly delusions. The only way to prevent this is to forcibly threaten prospective workers with harm if they seek to improve their lot. But that’s pretty mean, isn’t it?Report

              • Avatar Kim in reply to Cardiff Kook says:

                Duuuude. You’ve not read a thing about actual global strikes, have you?
                Not a myth. Maybe still in their infancy (read, “folks have better things to do”)… but about as fanciful as “flash mobs”Report

              • Avatar Oscar Gordon in reply to Kim says:

                A global strike still suffers from the Prisoner’s Dilemma.

                How do you prevent China from brutally oppressing a strike and promising manufacturers that such things will not be tolerated in China? You could impose sanctions on China, deny their ships access to US ports, deny their products to our markets, but how long will that last?Report

              • Avatar Kim in reply to Oscar Gordon says:

                The way I’ve seen it done, is that the folks striking in India get the folks back in Texas to also strike. That way they remind the CEO that his shit stinks, and nobody’s cleaning the bathrooms until the strike ends.

                global != universal.Report

              • Avatar Oscar Gordon in reply to Kim says:

                Assuming that India does not brutally suppress the strike, or just stand by while the company in question just restocks it’s workforce from people more compliant.

                A global strike requires a critical mass of strikers in places with labor friendly laws.Report

              • Avatar Kim in reply to Oscar Gordon says:

                So, um, places like China? When china has labor friendly laws (see new minimum wage), I think we’re winning…Report

              • Avatar Jaybird in reply to Kim says:

                So all we need is solidarity between Texans and Indians?Report

              • Avatar LWA in reply to Cardiff Kook says:

                @cardiff-kook
                Well yes, the current construction of global laws require workers to compete with each other, while cooperating with our employers.

                Which can be changed, right?

                As I have mentioned before, there isn’t anything preventing us from inserting global standards of wages and safety into the TPP negotiations.
                Or for that matter, refusing to enforce Japanese software patents, or German banking contracts, unless requirements X,Y, and Z are adhered to.

                Those measures may be wise or foolish, have good outcomes or bad, but they are not impossible.Report

              • Avatar j r in reply to LWA says:

                Well yes, the current construction of global laws require workers to compete with each other, while cooperating with our employers.

                No offense @lwa, but I don’t get the sense that you know all that much about global trade and labor laws.

                As I have mentioned before, there isn’t anything preventing us from inserting global standards of wages and safety into the TPP negotiations.

                There is a lot preventing us from inserting global wage standards into a trade treaty, first among those reasons that global wage standards are a bit of an oxymoron, since real wages are determined by the cost of living and there is not such thing as a global cost of living.

                That said, the TPP negotiations already addresses labor issues. I know this, because I literally did some of the research. And since DR-CAFTA, a decade ago, every trade deal that the United States has negotiated includes a labor chapter. Google the “May 10th agreement.” Or read this: https://ustr.gov/sites/default/files/uploads/factsheets/2007/asset_upload_file127_11319.pdfReport

              • Avatar LWA in reply to j r says:

                You just keep saying essentially that “its complicated”.
                Well of course its complicated!

                Constructing a global network of laws and regulations among dozens of different nations all agreeing to tariffs, taxes, patent and trademark laws, banking regulations and contract laws- is that easy?

                Of course not- it is wickedly difficult and took decades, with hundreds of separate treaties and thousands of negotiators over many sessions to work out.

                One of the leaks that has come out of the TPP negotiations is that corporations may be allowed to sue to overturn local laws which may reduce their profit.

                How come no one is saying how that is an impossibility, due to sovereignty and federalism and argle bargle?
                Because when something it vitally important it gets done.

                How come no one argued that a federal minimum wage was impossible because wage rates in Texas are different than New York?
                Well, they did, but those concerns were brushed aside, and a minimum wage was negotiated. And the Republic survived, and cats and dogs didn’t start sleeping together.

                The European Union, the Federal Reserve, the global network of domain names, airline traffic….none of these things were easy, all required complex multinational agreements. And all were accomplished.Report

              • Avatar Oscar Gordon in reply to LWA says:

                LWA: and cats and dogs didn’t start sleeping together.

                YOU LIE!!!Report

              • Avatar j r in reply to LWA says:

                You just keep saying essentially that “its complicated”.
                Well of course its complicated!

                Not sure if this is directed at me, but if it is: no, that’s not what I’m saying at all. What I am saying is that your understanding of international labor standards and global labor laws and regulations is seriously lacking. Much of what you appear to be arguing for already exists.

                On the specific issue of a global minimum wage, I suppose it’s something that you could do, but it would be a very bad idea. Laws are just text, you can pass a law saying just about anything. That doesn’t mean that passing a law will lead to the outcome that you want it to.Report

              • Avatar LWA in reply to j r says:

                @j-r
                I agree my knowledge is lacking.
                But what I do know is that the global system of laws is designed for a purpose, and that purpose is to protect the interests of capital and property.
                All the millions of pages of treaties and agreements drive towards this one purpose.
                The token measures you mention don’t change that- the interests of American and Bangladeshi workers are not represented by any more than the feeblest of efforts.

                The competition among global workers is a goal, not a natural occurrence.
                For instance, I can borrow money from a German bank and buy a lease in Jakarta seamlessly and effortlessly, because the laws are designed with this specific outcome in mind, to make this easy.

                yet can I donate money to the election campaign of a Mexican official, or organize Chinese workers to cooperatively strike?
                no- there are laws against these sorts of things.
                Again, the laws were designed with this outcome in mind- to make cooperation easy for corporations, but impossible for workers.

                My point here is that the marketplace is not a naturally occurring phenomenon beyond our control- it is a highly constructed and artificial edifice, designed to benefit those who designed it.Report

              • Avatar j r in reply to LWA says:

                For instance, I can borrow money from a German bank and buy a lease in Jakarta seamlessly and effortlessly, because the laws are designed with this specific outcome in mind, to make this easy.

                Really? When was the last time that you borrowed money from a German bank or tried to buy a lease in Jakarta.

                This is what I do for a living and I’m telling you that you’re characterizations are simply false.Report

              • Avatar LWA in reply to j r says:

                @j-r
                Which characterization is false?

                That globalization is designed to make international business seamless and easy?

                Or that it is a constructed edifice designed to benefit those who designed it?Report

              • Avatar Kim in reply to LWA says:

                LWA,
                there are also laws against Mexican child labor, I think… Mexican laws aren’t always well enforced, so pulling Mexico out as your example is kinda silly.

                The idea of laws in Nigeria (or Israel) is rather laughable — there are places with “flexible” laws.Report

              • Avatar Cardiff Kook in reply to Oscar Gordon says:

                @oscar-gordon

                “Not deregulation, but better regulation.”

                Well said. I have always disliked the regulation/deregulation paradigm. The appropriate way to frame it is better or worse regulation.

                Markets are regulated. Period. They need regulation of some type, though it doesn’t always have to come from above. The key is the optimum amount of regulation to optimize social welfare. In some cases, we need more regulation. In other (OK lots of other) situations we need streamlined and more intelligent regulation. Most importantly we need regulation which doesn’t try to determine winners and losers but instead allows the players to play the game — fairly.Report

              • Avatar Kim in reply to Cardiff Kook says:

                this is a nice comment.
                All I want is a minimum wage that is indexed to cost of living, just like everything else the government does. Then I want to stop talking about it, and focus on Anything Else.Report

        • Avatar LeeEsq in reply to Rufus F. says:

          You can only get business people to run their companies like this under certain circumstances. It requires both an external threat like communism or militant labor union activism and an internal class desire to act more like a traditional aristocracy on the part of business people or something similar. We don’t have an external threat like communism and most business people lost the desire to act like nobility.Report

          • Avatar Rufus F. in reply to LeeEsq says:

            Lee Esq. I do think the collapse of Communism/ “end of history” played a big part in the gloves coming off. I still think, however, that the race to the bottom can last fifteen more years tops. There comes a point where it’s a matter of social instability. Not to mention the waste!! F’rinstance, I met a guy the other day who worked for a big company in the area from college on, got apprenticed in, always did well, never a complaint, now they fired him in his mid-50s as part of cost-cutting measures, so now he’s doing six-month contract gigs for other companies. And you think, okay, so they saved on his pension and axed someone with years of knowledge to probably wind up replacing him with three contract guys that now have to be trained from the get go. It’s not really that “competitive” when you think about it.Report

            • Avatar LeeEsq in reply to Rufus F. says:

              @rufus-f, in the United States and the United Kingdom, the gloves came off at least a decade before Communism fell. By the late 1970s if not earlier, Communism lost its threat as a bogeyman in both countries. Even when Communism was a bogeyman, a significant portion of the business establishment wanted to fight any sort of concession to labor with tooth, claw, and nail in the United States. Not everybody agreed that a social contract between capital and labor existed in at the height of communism. The communist bogeyman thesis is also highly problematic because it means that hundreds of millions need to suffer under a terrible alternative to capitalism in order for the masses in the West to get protection.

              I’m reading Austerity Britain right now. Its a history of Britain from 1945 to 1951 and its part of massive project called Tales of the New Jerusalem to right about all the changes to British society between 1945 and 1979. The author describes the type of economy I guess your imagining when you write about the social contract between capital and labor when discussing the world of business in late 1940s Britain. Most businesses were run on gentlemanly and paternalistic lines regardless of what they did. Employment tended to be for a lifetime and follow a definite progression based on seniority. It definitely is an attractive picture, its just not really sustainable as model. The more aggressive business people would simply eat the more gentlemanly firms up.Report

              • Avatar Rufus F. in reply to LeeEsq says:

                I don’t disagree that this is where we’re at. But how long is this model sustainable? My guess was 15 years more, assuming there’s not another huge recession. I could imagine 20 years more, but it’s hard to envision another 30 or 40. I also assume it’s not coincidence that our increasingly “market-based” societies have become increasingly punitive as well.Report

              • Avatar North in reply to Rufus F. says:

                I’m not 100% certain but I suspect it’s sustainable only as long as the economy remains sluggish.Report

        • Avatar Kim in reply to Rufus F. says:

          With 47% of current American Jobs being gone in 20 years, how much of this is make work or otherwise really, really silly?

          I mean, are you proposing that someone who hires an accountant now, needs to keep them hired for 20 YEARS of doing NOTHING IMPORTANT???Report

          • Avatar Jaybird in reply to Kim says:

            (You’ve mentioned that uncannily specific percentage a number of times. Might I ask where you’re getting it from?)Report

            • Avatar DensityDuck in reply to Jaybird says:

              Infowars and Zerohedge both have a large number of well-researched and thoroughly-sourced articles on the topic, I’m sure.Report

            • Avatar Saul Degraw in reply to Jaybird says:

              @jaybird

              Where does Kim get any of her numbers from?Report

              • Avatar Kolohe in reply to Kim says:

                It’s 47% have a 70% or greater probability that the job will be automated ‘in some unspecified number of year, perhaps in a decade or two’

                They are betting a lot on self-driving ground vehicles becoming a dominant mode of transportation in that time frame, and, looking at some of their other job categories, giving greater than 90% probability to what have long been holy grails of automation (e.g. contract farm labor), and giving other ridiculous 90+ percent probabilities like “Models” and “Tax Collectors”. (otoh, “Broadcast News Analysts” have less than a 7% change of computerization – a job done by Bill Kristol can definitely be done by a robot)Report

              • Avatar Kim in reply to Kolohe says:

                Pop News was calling it at 20 years (and also saying “all jobs” not just American, which IMNSHO is ridiculous).
                This is basically an analysis of the possible, and then pushing it out 20 years to “we’ll have worked the kinks out.”

                I know someone writing algorithms for Uber (where the hell did you think I hear stuff like this from?). Self-driving trucks in ten years (main routes primarily — use the post office for the “to the door”), mostly driven by insurance companies (who will be quite happy to insist on their use once their proven to cause fewer accidents).

                After they get the trucks, the cars will be cake.Report

              • Avatar DensityDuck in reply to Kim says:

                Remember how the Dow-Jones average was going to hit 50,000 by now?Report

              • Avatar Kim in reply to DensityDuck says:

                DD,
                Yeah, I’m listening to the folks who called the crash and made more money off it than Harvard did.Report

            • Avatar Cardiff Kook in reply to Jaybird says:

              She has her statistics, but I have the actual names of those who will be affected and their termination dates.

              On a more serious note, I am pretty sure 99% (actually 98.67843%) of all jobs were eliminated or replaced over the last two centuries. If we are lucky, the same thing happens over the next two hundred years too. Creative destruction and all.

              The thing to focus on is that even more jobs are CREATED. I could make suggestions on some good ideas to facilitate job creation, and as a hint none of my suggestions involve mandatory benefits, minimum wages, licenses, restrictions on self employment, taxi medallions, barriers to entry, barriers to terminating employees, statistically-naive equal pay for women initiatives, or closed shop unions.Report

              • Avatar Kim in reply to Cardiff Kook says:

                So you’re the butterfly!
                A large portion of jobs in the past century haven’t changed all… that … much… (lawyering, doctoring, cooks, construction just to grab a few out of the hat).
                I realize I’m not disagreeing with you.

                Why would we want a $10 a week job, anyway? What’s the point, when we can get a robot to do it for $11 a week? Isn’t free time worth anything?Report

        • Avatar Cardiff Kook in reply to Rufus F. says:

          Rufus,

          The reason businesses have changed is because the environment changed. What worked then was the predominant strategy because it was, on average, the dominant ie winning strategy. That’s how I played the game when I started out of school.

          But then the world changed. So the dominant strategy changed with it, and therefore the predominant strategy changed.

          What changed?
          Faster change, driven greatly by technology
          MUCH tougher competition as the Internet made the world more integrated, driving out waste and overhead wherever it existed
          Limitations and regulations (both internal and external) on hiring, firing, promoting, salaries and benefits.
          More wage competition from the billion new workers entering the market
          Improved technology replacing workers

          Some of these are continuation of long term trends. Some are recent complications or amplifications. The point is that by the end of my career as an employer of lots of people, I started finding the old model was simply dysfunctional — laughably, ridiculously so.

          Your nostalgia over some mythical social contract and some golden era where businesses focused on the long term is misplaced. When the game changes, the players change or the players leave the court. The game changed.Report

    • Avatar Kim in reply to Rufus F. says:

      What does that actually entail though?
      UBER makes self-driving car today. What do they have to do with the unemployed driver?
      Do they need to pay current employees more?
      Do we care, because we’ve all gained mucho productivity and LAND from less time spent driving and more optimal use of cars?Report

    • Avatar j r in reply to Rufus F. says:

      I may be one of “them,” but I’ll offer a different response:

      Perhaps reestablishing a 20th century, post-WW2 social contract isn’t the best idea for dealing with the 21st century economy.Report

  6. Avatar Kolohe says:

    John Angelos, the COO of the Orioles

    “Hi, we’re here to sue your industry into oblivion”

    30 years later: “Dad, where did all the jobs go?”Report

  7. Avatar James K says:

    A lot to chew on here Saul:

    1)

    There are lots of problems with this kind of populism especially because it is ideologically vague. You can easily imagine this sort of populism coming from the dreamed of Tea Party-Occupy alliances that pundits talk about from time to time.

    I agree, being dissatisfied with the status quo is not the same as being aligned on the solution. Not to mention that the larger and more heterogeneous a group gets, the harder it gets to coordinate it. That’s the whole reason the “we are the 99%” rally cry never got anywhere. Do you know what 99% of people have in common? Nothing.

    2)

    One of the biggest criticisms of the app economy is that they don’t add value to the economy overall but merely exist to solve social problems and laziness issues among affluent people in cities and inner-ring suburbs.

    Solving people’s problems is a social good. This leaves me unsure as to what you mean by “adding to the economy”.

    3)

    Most people do not thrive on anarchy and I see very little reason why we should be ruled by those who can thrive on chaos and anarchy or as tech prefers to call it “disruption.”

    Not every change in an improvement, but every improvement is a change. Without change there can be no progress. We would not be better off if the world was still like it was in 1770, and I very much doubt our descendants would thank us for trying to keep the world looking like 1970 (assuming that would even be possible). On top of that, failure is a necessary part of the operation of market economics. The reason government is more prone to bad decisions than markets is not that entrepreneurs are Heroic Visionaries, but because markets have a lower tolerance for failure. Eventually bad decisions are culled form the market, increasing the average level of correctness in the market. Failure is endemic to the process, without it you end up like Japan – caught in a 20-year recession because the market is full of companies that made bad decisions, but are not permitted to die of it.

    4)

    I find it perplexing that business and economics are obsessed with finding more and more ways of cutting costs and treating employees (that is fellow humans) as liabilities instead assets.

    It’s actually really simple. Employment is an exchange of money and other benefits for some consideration (the work the employee does, or more specifically the benefit the employer obtains from that work). In particular, the non-wage costs of full-time employees is steadily growing (I’m thinking mostly health insurance here), so employers are reacting by reducing the amount of full-time employees they have – obtaining the same (or perhaps slightly lower) benefit, for a significantly lower cost.

    This is why trying to make companies act like welfare agencies toward their employees is a bad idea, and why I advocate for the Guaranteed Basic Income as a solution – its a solution I actually think will work, and that sort of thing matters a lot to me. How do we bring it about? Marketing is not my forte, but I think a key element is to make transparent the hidden transfers in the status quo. If people realise things like employer-funded health insurance and minimum wages aren’t a free lunch, then they’ll realise that the GBI is much less expensive than it looks.Report

    • Avatar Oscar Gordon in reply to James K says:

      Or we could just do away with the employment taxes & shift them elsewhere. These are holdovers from a different time, and I’ve never seen a decent defense of them from an economic health standpoint (usually they are defended on a government revenue basis).Report

    • Avatar Cardiff Kook in reply to James K says:

      Saul, I really suggest that you try to grapple with the excellent points JK made on numbers 2 -4. He is pointing out some of the key framing errors that most people tend to make in economics.

      You seem to be interested in both personal enrichment and in making the world a better place. Step one might involve understanding the points James is making.Report

    • Avatar Mike Schilling in reply to James K says:

      @james-k

      There are also psychic wages from cutting employment and pay. You can infer this from the things many employers still get wrong. e.g.

      * outsourcing because they consider only the difference in wage expense, not the inefficiencies caused by time-zone differences and the added difficulties of long-distance communication,

      * not valuing employee morale, even though the costs of high attrition rates (hiring is expensive, new hire ramp-up time leads to large losses in productivity, institutional memory is a highly undervalued asset) are often less than the costs of reducing attrition.

      The second point, in particular, is not affected by added non-wage costs. It is affected by the cult of being a tough guy.Report

  8. Avatar Oscar Gordon says:

    Regarding the decline of Labor Unions, this is interesting.

    A lot if this is of interest (it’s a few pages, see the arrow buttons at the bottom), especially this:

    2. Enduring NERPs always match or exceed employment conditions in unionized firms.

    “Unlike Senator Wagner’s argument that nonunion forms of representation result in competitive forces that drive down worker salaries and compensation packages to the lowest possible denominator,” explained Taras, “we actually found no empirical evidence to justify the position.” Instead, employees at these workplaces tend to unionize quickly when conditions erode, so it is in the interest of management to honor workers’ demands—for example, to pay at or above union wage rates.

    The decline of Unions does not equate to the decline of labor organization & voice. These NERPs (nonunion employee representation plans) are not recognized by the NLRB, and might even be illegal, but the nonetheless exist & function.

    Perhaps it is time the Wagner Act be amended to recognize such things (or some equivalent legislative action).

    NOTE: This is from 1999, so it’s already 16 years old.Report

  9. Avatar LWA says:

    Regarding “disruption””:
    This is a buzzword that hides as much as it illuminates.

    Tech companies want to disrupt existing business models.
    But only some!
    They still want much of the same protections and relationships with the citizenry that older firms do.
    Uber still wants me to help protect its software patents, enforce its contracts, and so on.

    They don’t want to be left alone- they want a deep and complex engagement with the citizens, and they very badly want to use the coercive power of government for the things they want to protect.

    What I have been asking is why we should feel powerless to exercise our power in this relationship.Report

  10. @saul-degraw

    I should have said this earlier but didn’t. I have dispute title of this OP, at least inasmuch as it’s envisioned as a response to what I had written. (The blog lede says it’s a response to my OP.) The suggestion that I advocate a “race to the bottom” is assumed, and not proven. I also have never said, and I do not believe, that “job quality doesn’t matter.” One of my arguments for my jobs first preference is that I hope that more jobs might eventually lead to better jobs. That argument may be flawed. In fact, I acknowledge many of the ways it may be flawed in my original OP to which this OP is supposed to be a response. But that position–and not the claim that job quality “doesn’t matter”–is my position.Report

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