May 9, 2014
The Human Cost of Your Mother's Day Flowers | VICE Canada

I was talking to my roommate the other day about the scary reality that the standard of living in Western countries is effectively subsidized by poverty in the countries where those goods are produced.  We have cheap ipods, televisions, basketballs, and various other types of consumer goods because other countries don’t prohibit employers from exploiting desperately poor individuals whose circumstances and lack of savings or capital leave them little in the way of economic alternatives.

There’s going to come a day when this system falls apart.  The standard of living in many of these countries is going up.  As these countries continue to develop social, political, and economic infrastructure that gives people at the bottom more economic alternatives, they’ll be able to demand better wages and working conditions.  Eventually, it will be impossible for Multinationals to continue exploiting cheap labor in these less-developed countries, because labor won’t be cheap anymore.  When that time comes, the standard of living in America is probably going to drop relative to what’s it’s been in the past.  And the gravy train will be over.

February 11, 2014

buttonpoetry:

Javon Johnson & Terisa Siagatonu - “PTSD”

"The only difference there is between a soldier with PTSD and one of my students with it, is that the soldier gets to leave the battlefield while my kids go home to it."

Performing at the 2013 National Poetry Slam for Hollywood’s Da Poetry Lounge. Check out more of Javon’s work in VIRAL.

LTMC: Related: Symptoms of Posttraumatic Stress Disorder Among Urban Residents (Parto et al. 2011)

December 27, 2013
"Here’s an incredible fact: If the typical American family still retained the same share of [national] income that they did in 1970 they would earn about $45,000 more per year. Imagine what our economy would be like if that were the case."

Nick Hanauer

November 26, 2013
"Look at the difference: In 1977 I bought a small house in Portland Oregon for $24,000. At the time I was earning $5 per hour working at a large auto parts store. I owned a 4 year old Chevy Nova that cost $1,500. Now, 36 years later that same job pays $8 an hour, that same house costs $185,000 and a 4 year old Chevy costs $10,000. Wages haven’t kept up with expenses at all. And, I should point out that that $5 an hour job in 1977 was union and included heath benefits."

an anonymous online commenter on the current economy. (via alchemy)

LTMC: When I was working at a gas station, I had an old-timer come in and tell that he used to make $2/hour at a factory job when he was in his late 20’s.  He said he could feed his whole family for the night by buying a 24-cut pizza for $2.  Fast forward to my gas station job, where I was making $8/hour, but a 24-cut pizza in my town costs closer to $20—2.5 times more on a dollar-for-dollar basis.  He said he had no idea how I even survived on what I was making (I was insured through college at the time, but had no savings, and relied on family for large expenses).

This is what people mean when they talk about income inequality.  The reason wages have not kept pace with expenses is because the nation’s previous method of wage redistribution—union representation—has declined substantially.  Wage increases have subsequently been absorbed on an increasingly larger basis by corporate entities and the top 1% of earners.  Strong unions used to serve as a soft redistribution mechanism to help ensure that increases in prosperity were shared equally.  A critical mass of union representation in the labor force has always had derivative wage benefits in the non-union labor market.  That critical mass no longer exists, however.  Consequently, the decline of union labor has led to a concurrent decline in wages relative to expenses, because there’s no longer an institutional mechanism for redistribution of earnings increases in the economy.  The critical mass of union representation is gone, and nothing has taken its place.

(Source: han-nara, via cognitivedissonance)

April 18, 2013
"

For the last four years I have never heard anger directed at the rich from the addicts and homeless I know. They know I have money. They are happy for me, happy for others who do well. There is lots of anger at the rich from places like Occupy Wall Street, but not anger that I have heard from the bottom 1%.

They get upset with the overall policies, but never the individuals. They get upset when they feel society is treating them as less than humans, as pariahs, as criminals rather than the ill.

I do hear angry comments directed at the poor from some of those on Wall Street (not from anyone I am friends with) the general tone (and a direct quote) is, “Why am I paying to give lazy fucks free things?” That attitude, that addicts are lazy, permeates the media.

The addicts work very hard, perhaps not legal work, but the work that they can get. They use the only opportunities they have. They scrap metal, sell their bodies, boost from stores. It’s hard, physically demanding work that requires huge risks. They are some of the cleverest people I know.

"

Chris Arnade

April 12, 2012
"

You present a cake to your family. Is it fairer to:


a) give everybody a slice of [equal] size, or

b) make everybody fight with broadswords, so they all have [equality of] opportunity to win the entire cake for themselves?

"

Comments, Slacktivist: Jason DeParle on Mothers and Their Children

I would give them equal slices of cake and broadswords.  But that’s just me.

March 17, 2012
"I was in Copenhagen last year, where I saw a number of bikes leaning on buildings, unlocked. Then I saw more, just tossed over on the grass. I asked a Dane what the deal was. Nobody really wanted the bikes, it turns out, because everyone that wanted one already had one. Or had access to one, through the city’s bike-share system. No bike thief could make any serious money selling bikes. Besides, income equality was much greater in Denmark, and the have-nots were not nearly as destitute or desperate as those in a city like New York. The incentive for organized bike-stealing was simply not there."

Why Won’t People Stop A Bike Thief?

March 12, 2012
"[A]fter the military, the top four employers listed by twenty-somethings were Walmart, Starbucks, Target, and Best Buy."

Nona Willis Aronowitz, Will Gen Y’s Career Waiters Occupy The Service Industry?

h/t

February 11, 2012
Economic Equality And Efficiency: False Choices

Andrew Berg et al. sum up a study from late last year, in which it was found that efforts to reduce economic inequality through redistributive policies is not, as economists previously believed, detrimental to economic growth:

IN his influential 1975 book Equality and Efficiency: The Big Tradeoff, Arthur Okun argued that pursuing equality can reduce efficiency (the total output produced with given resources). The late Yale University and Brookings Institution economist said that not only can more equal distribution of incomes reduce incentives to work and invest, but the efforts to redistribute—through such mechanisms as the tax code and minimum wages—can themselves be costly.

And yet, as Galileo might say, “it moves:”

In recent work (Berg, Ostry, and Zettelmeyer, 2011; and Berg and Ostry, 2011), we discovered that when growth is looked at over the long term, the trade-off between efficiency and equality may not exist. In fact equality appears to be an important ingredient in promoting and sustaining growth. The difference between countries that can sustain rapid growth for many years or even decades and the many others that see growth spurts fade quickly may be the level of inequality. Countries may find that improving equality may also improve efficiency, understood as more sustainable long-run growth.

There’s something important that needs to be acknowledged, however.  Returning to Arthur Okun:

Okun likened these mechanisms to a “leaky bucket.” Some of the resources transferred from rich to poor “will simply disappear in transit, so the poor will not receive all the money that is taken from the rich”—the result of administrative costs and disincentives to work for both those who pay taxes and those who receive transfers.

That’s absolutely true.  Redistribution is inherently inefficient.  But the question is whether the inefficiency of redistribution is nonetheless outweighed by the inefficiency of structural economic inequality.  Value loss occurs in voluntary transactions as well as public transactions.  Impoverished persons have economic needs that they can’t meet due to a lack of liquid assets.  They may also be unemployed and without the means to acquire new skills that would allow them to fulfill a more pressing economic need without some sort of extrinsic intervention on their behalf.  And the marginal propensity to consume by an impoverished individual is larger, up to a certain income threshold (relative to constant price levels), than the transfer-loss created by redistribution.  Obviously it’s not always that simple, but comparative data sets often confirm the theory.

Another thing that’s important to keep in mind is that we do have a choice in what the distribution of wealth looks like.  It is, all other things being equal, a policy decision, and not the result of inevitable primordial economic forces.  Take it away, John Stuart Mill:

We cannot alter the ultimate properties either of matter or mind, but can only employ those properties more or less successfully, to bring about the events in which we are interested.

It is not so with the Distribution of wealth. That is a matter of human institution solely. The things once there, mankind, individually or collectively, can do with them as they like. They can place them at the disposal of whomsoever they please, and on whatever terms. Further, in the social state, in every state except total solitude, any disposal whatever of them can only take place by the consent of society, or rather of those who dispose of its active force. Even what a person has produced by his individual toil, unaided by any one, he cannot keep, unless by the permission of society. Not only can society take it from him, but individuals could and would take it from him, if society only remained passive; if it did not either interfere en masse, or employ and pay people for the purpose of preventing him from being disturbed in the possession. The distribution of wealth, therefore, depends on the laws and customs of society. The rules by which it is determined, are what the opinions and feelings of the ruling portion of the community make them, and are very different in different ages and countries; and might be still more different, if mankind so chose.

And mankind can so choose.  If he wills it.

Update: The NYT posted an article yesterday about the rising education gap between the rich and poor.  As the economy becomes more complex and technologically advanced, education is required to fill the job roles that the economy demands.  That means that unskilled laborers are less likely, as a class of individuals, to be able to find gainful employment as the skills needed to participate in the labor market become more complex.  Without the resources to acquire the education necessary to get these skills, a larger and larger portion of the class remains unproductive.  This is precisely the kind of inefficiency that redistribution (e.g. publicly-funded education) is meant to alleviate.

January 20, 2012
"[I]n a recent survey of a range of individuals across the political spectrum, an overwhelming number of those surveyed stated that they would prefer to live in a society that had a more even distribution of wealth than that found in the U.S., and most participants underestimated the degree of wealth disparity in the U.S. Moreover, the survey participants were asked to choose between two hypothetical societies, with different levels of wealth inequality. What they did not know was that they were essentially being asked to choose between Sweden and the U.S. in terms of wealth distribution. Across the political spectrum, an overwhelming number of survey participants — 92 percent —chose Sweden over the U.S., and even study participants who voted for George W. Bush in the 2004 presidential election still preferred Sweden to the U.S. by a margin of 9-1."

Ray Brescia, "A Trust Deficit?  Look To The Inequality."

Disclosure: Ray taught my Civil Procedure class at Albany Law last year.  Interesting side-note: Ray was personally involved in litigation against both the Bush Sr. and Clinton administrations concerning the plight of Haitian refugees at Guantanamo Bay back in the ‘90’s.  You can read about his experience in Storming the Court, available at fine internet bookstores everywhere.

Liked posts on Tumblr: More liked posts »