Washington Post: 1.3 millon will lose Unemployment Benefits in the New Year

Washington Post reporter Brad Plumer has the story. WonkBook: Unemployment benefits for 1.3 million expire Saturday.Here's why. 

Washinton Post writer Niraj Chokshi, analyzes which states are affected. GovBeat: Where the 1.3 Million people losing unemployment aid this week live.

Washington Post And Seattle Times: Airport workers my not get their $15 wage

For the purpose of a $15 dollar minimum wage, a judge has ruled that the airport is outside of the jurisdiction of SeaTec and only resturant workers and parking attendants qualify for the higher wage.

Washington Post: SeaTac's minimum wage workers might not get their raise after all. The washington post do a good job of summing up the issues.

The Seattle Times: SeaTac's $15 dollar wage floor cannot include airport workers.

NY Amsterdam News: Wage theft employees get their jobs back

In a story from the New York Amsterdam news, by Stephon Johnson, twenty five Dominos Pizza employees in northern manhatten will be re-instated after being terminated several days prior.



NY Amseterdam news has the story here.

New York Times: Work Makes you Happy

A New York Times Opinion by Arthur C. Brooks called "A Formula for Happiness" discusses the contribution work can make toward happineess.  The author believes that happiness is determined by genes, life circumstance and work.

About 48% of your happiness is determine by your inherited traits.

About 40% is short and medium term rewards such as buying stuff, family events, or graduating high school. The effect wears off quickly.

The remaining 12% are discrenary activities that include faith, family, freinds and work.  Friends and family are obvious, but work is the most interesting. Meaningful and fulfilling work can deliver personal happiness and financial reward.

The American Enterprise Institute calls this happiness effect "Earned Success".  The times editorial is light on the AEI philosopy but you can get a bigger dose on YouTube. Arthur Brooks: The secret to happiness.

The video on youtube discusses happiness and the it's AEI pro entrepreneurship (pro business) philosophy. The AEI promotes free enterprise as a "moral goal."

Here is another reseacher, Dan Gilbert talking about synthentic versus real happiness. Ted Talks: Dan Gilbert, the surprising science of happiness.

There are two issues we have with the reseach: 1) The low value given to work as a generator of happiness, 2) second is the twist the American Enterprise Insititue gives the reseach at the end to support their position.

First, we can't believe work contributes only part of the overal all 12% happiness.  For many of us the work is also closely entertwined with self esteem, financial empowerment and health.

Second, the reseach all makes sense up until when the AEI tries to slip in it's economic message.  Work has a value above it's financial return. Work in all forms is valuable: private, public and non-profit.

Bloomberg: Fraternity Affirmative Action or Meritocracy Not

Fraternity members have their own secret affarmative action program.  Bloomberg has the details in a piece called "Secret Handshakes Greet Frat Brothers on Wall Street". The new film "Wolf of Wall Street" publicizes the male dominated culture of the financial industry.

We have long known networks constitute a form of affirmative action for the powerful and their off spring.

What is most disappointing is how privilage networks are described as meritoracies when so many are excluded.

Chicago Tribune: PR Executive for IAC(BlackPeopleMeet, Match.com, Daily Beast) fired for Racist Tweet

The Chicago Tribune writes that Justine Sacco, a PR executive at IAC (InterActiveCorp), who tweeted racist comments before traveling to Africa was fired by her company. IAC is general media company with large internet interests.  It is led by Barry Diller who developed fox broadcasting and USA networks.

The Chicago Tribune has the story here: "PR Executive Justine Sacco fired after insenstive tweets goes global".

The UK daily mail also has good coverage: "Fired: PR Exec who sparked outrage with racist tweet..."

IAC (InterActiveCorp) owns many well known websites including BlackPeopleMeet, Match.com, Daily Beast, CitySearch, Vimeo, CollegeHumo, Ask.com, About.com and UrbanSpoon

Bill Moyers: US has 25 percent of world's prisioners

The US criminalizes many civil offenses

Bill Moyers: US has 25 percent of worlds prisioners

Salon: US becoming low wage country

US politicians anf governments have made a huge mistake by ignoring wage growth.

Joan Walsh writes in Salon: Poverty Nation: How america created a low wage work swamp.

Daily Mail (UK). Study reveals on-line racism

The Daily Mail (UK) reported the results of a study in the Economic Journal of the Royal Economic Society. The study compared online offers for an Apple IPod using a black hand, a white hand and a white hand with a tattoo.

The Daily Mail story is here: How on line shopping reveals we are racist.

The image with a black hand received less offers and at a lower price.

The study is called "The Visible Hand: Race and Online Market Outcomes" and is featured at the Royal Economic Society.

New York Times Again: Best article this year on unemployment !!!

Well, getting tired of quoting the New York Times or making referrals, but they are just head and shoulders above everyone else.

Here is a another great, long-form piece on what it's like to be unemployed.

New York Times: Caught in a revolving door of unemployment.

If you have time, read the comments. Some are quite heartless and vicious. They show no empathy what We don't think you are qualified to comment unless you have been

New York Times: Poverty in the United States

Mark R. Rank, a professor of social welfare at Washington University in St. Louis writes an excellent summary of people in poverty in the US.  The story appears in the New York Times on November 2nd, 2013.  The piece is here(NYT). The article refuts many of the myths around people in poverty.

Some of the highight include...

Poverty is much more widespread than people realize.  More than half of all people in the US will experience a year in or near the poverty level. The poverty level is about $11,000 for an individual and $23,000 for a family of four.

The number of people in long term poverty is also small. To paraphrase the story, "People experience a year to two in poverty, then a longer period above the poverty line, then slip back again."

Most people in poverty are white.  About two thirds of people in poverty are white. The figure has remained the same "for several decades"

Finally, the author notes that people in poverty are motivated to work.  They have the same attitudes and behaviors as the rest of the country.

The sad part of Professor Rank's article is that curing poverty requires the will of the people and government which does not seem to care.

NYT: Poverty in America is Mainstream

Some links for Corporate Social Responsibilty (This stuff smells a lot like PR)

Once again, we can't believe how mis informed and uncaring the average US consumer is when making purchases.

And we also can't believe how disingenous big companies are when it come to corporate responsibility.  In fact they call the field "Reputation Management" not social responsibility.

One of our longer term ideas for an Apps that gives a social responsibility score for companies.



Here are some links in the area of Corporate Social Responsibility


Reputation Insititute

Article from NK Warikoo and C Fuhr: Legitimating status: Perceiptions of meritocracy .... at Oxford

Here is a very interesting article about how the elite view meritocracy and equality. The article, called "Legitimating Status: perceptions of meritocracy and inequality among undergraduates at an elite British university" appears in the British Educational Reseach Journal. Here is the link.

The researchers interviwed 46 students at Oxford University.

We got a tip from the BBC program "Thinking allowed" which intervied Ms. Warikoo who is an assistant professor at Harvard School of Education.  Here is the link to the thinking allowed program.

Here are some highlights:

80% believe admissions were based on merit alone.

40% believe there is some truth to inequlaity in schools which affects the admissions process.

Students ignored family background. They also had a general conservative view of the whole process.

Students were against postive discrimination in general.

The discussion on "Thinking Allowed" noted that 75% of US students fvor special help for working class students while only 33% of UK students thought such help was needed.

From the Washington Post. Low skilled immigrants: Economic burden or boom ?

Here's the link: Low skilled immigrants: Economic burden or boom ?

The Washington post published a story on the impact low-skilled immigrants on low skill US born citizens.

The article at least acknowledges a well known fact in the Black community: that immigrants take jobs from black people, depress wages for poor people and control businesses in black neighborhoods. final reports the impact immigrants are having on the Black community.

The issue we have is that WAPO and the press in general tries to cover an issue that really hurts poor people with fake objectivity.

Almost everyone agrees that some immigration in general is good for the country.  People will also admit, grudging, that poor immigration hurts the existing US poor. And a lot of poor people are black. A lot of us also benefit from immigration: we get cheap food, all night convienice stores, and low cost landscaping and construction labor.

Our solution:  We should switch our model to rich immigration: Doctors, lawyers, dentists and CEO should be allowed to immigrate freely.  Limits should be placed on poor immigration.

Center for American Progress: Polorization of Job Opportunities in the US Labor Market

We have all known about the lack of good paying jobs for more than 30 years.  But it is not official until an economist publishes a paper about it.  So here is that paper.

The Center for American Progress and the Hamilton Project have publish a study by David Autor of MIT called "The Polorization of Job Opportunities in the US Labor Market".

Oxfam America Survey: Low wage workers have it very difficult in the US

Oxfam America, part of the Oxfam International, anti-poverty group, published a survey called "Hard Work, Hard Lives", which details the experiences of 804 low-wage workers in the United States.

Workers in the survey made less than $14.00 per hour and most had a family income of less than $40,000 per year.

Here are some highlights:

Fifty nine percent (59%) of respondants said they "Barely meet" or "Don't have enough to meet" their basic living expenses.

Low wage workers worry most about saving for retirement and unaffordable health expenses. They use food stamps and financial support from friends and family to survive.

Yet, 62% of of low wage workers believe hard work will get them ahead and 94% blieve performing your job well is important or extremely important.

Sadly, 76% of low-payed workers think that people are falling out of the middle class while only 12% are rising into the middle class from the lower class.


The report of the survey is here: "Hard Work; Hard Lives".

Fast Food Workers Strike for Better Wages

The Assocaited Press as carried by  USA Today has the story of the fast food workers strike.

USA Today: Fast Food wrokers stage strikes



The workers are asking for $15 dollar wage. The strike was support by SEIU - the service wrokers union. The strike seemed to be a tool to general publicity and favorable news coverge.

NJ.COM: Wide support for raising NJ minimum wage in November ballot question

In my state, New Jersey, the minimum wage is only $7.25. In June of 2012, the NJ senate and house voted to increase the NJ minimum wage to $8.50. However, Gov. Christie vetoed the bill in January of 2013. Now  the legislature is proposing a constitutional amendment to raise the wage to $8.25 and index it to inflation. The amendment will appear on the November ballot.

A survey show that about 3/4 of the registered voters favored the initiative. NJ.COM has the story here.

Many states are planning initiaitve to raise the minimum wage. The department of labor has a map of the current minimum wage pay rates in the US. The DOL map is here. Some big Northeastern states like NY, NJ, PA and MD pay only the federal minimum wage rate.

Recent research has shown that minimum wage increases are employment neutral to employment positive because the people who receive the minimum wage spend almost 100% of their money. It also has less of an impact on small business since the majority of minimum wage employers are large companies.

Politically, the issue has gotten little attention and is expected to pass easily.  Christine, who has presidential ambitions, will mostly likely ignore the issue or make half-hearted arguments against it, to provide cover against the national Republicans.

The reason we noticed the issue was because of a group called  EPI -- The Employment Policies Institute has been running ads in New Jersey against the increase. NJ.COM has the ad for the group here. The Employment Policies Institue is a front for a convervative public relations company called Berman and Co. who's clients include companies in the low wage food and beverage industry.  You can read about Berman & Co. here and here.

EPI has two web sites opposed to raising the minimum wage.  One called EPI-Online is against raising the minimum wage and health insurance. The second called Minimumwage.com is purely against raising the minimum wage. Both sites have few facts or research based ideas and instead offer the standard convervative ideas on raising the minimum wage.

Gov. Christie refused to sign a bill during the summer of 2012 that would have raised the wage to $8.50. That led to the current ballot measure. It will interesting to see if he takes a stand on the popular issue. Opposing any minimum wage increase has become a test for republicans.

The ballot measure reads:

"Do you approve amending the State Constitution to set a State minimum wage rate of at least $8.25 per hour? The amendment also requires annual increases in that rate if there are annual increases in the cost of living. 
YES 
NO"

Hard work: President Obama's Speech on "A Better Bargin for the Middle Class" at Knox College in Galesburg, Illinois

On July 24, 2013, President Obama gave a major economic speech at Knox College in Galesburg, Illinois.

Here is the text of the President's speech.

What can you say ?  As good journalist you need to first layout the facts and as a blogger you must give your opinion.

Facts

Obama discussed the changing economy and the effect of the changes on the middle class in the United States. He discussed the economic environment that everyone is now aware of.  He reviewed the decline in manufacturing, the growth of the service economy, and flat wage growth.

He talked about the main policies that would help the middle class such as healthcare, expanded education opportunities and support for a secure retirement.

Opinion

The presidents team has realized that the US economy is fundementally a middle class economy. However the middle class has long been disinterested in the US political economy. For the last 30 years, the US middle class had enough material comforts and distractions to not worry about larger issues.    Now, people are faced with a declining living standard not just for their children but themselves.  They are ready to listen.

Obama, is trying to use the opportunity to discuss sound economic and political values that will steer the country for the next 30 years. Some of the principles such as caring for the unemployed, poor, sick or elderly did not connect with an selfish public until enough of them faced a similar situation. Not they are ready to listen.

It's just hard work discussing a compliated, long-term topic with the American People.

CEPR: Has Education paid off for Black Workers ?

The Center for Economic and Policy Research has a report on education not paying off for Black workers. The report called: "Has Education paid off for Black Workers ?".

Pew Reseach: 46% of African Americans believe there is a lot of discrimination

Pew Reseach has a report on African American perceptions of discrimination. 46% of blacks believe there is a lot of discrimination while only 16% of whites believe the same. The story called "For African Americans, discrimination is not dead" was publish in the fact tank section.

The Verge: Immigration hurts middle class tech workers but helps US businesses

Here is a story from "The Verge" by Ben Popper discussing the impact of H-1B visas on middle class tech workers. It is a called "Is Silicon Valley's immigration agenda gutting the tech industry's middle class ?"

The Global Decline of the Labor Share

Here is the inequality paper everyone is talking about.

The sad truth is here. The Global Decline of the Labor Share.

Wisconsin DWD: Minorities and Women in Construction Trade Apprenticeships 2010

The Wisconsin department of workforce development issued a report in 2010 on the small number of minority and women who participate in construction trade apprenticeships. Trade apprenticeships are one of the most effective ways for non-college youth to earn above market salaries, benefits and job security.

The summary is here: Report Highlights: Minorities and Women in Construction Trade Apprenticeships.

The full report is here: An Evaluation: Minorities and Women in Construction Trade Apprenticeships.

The report had three recommendations: 1) Centrally track the number of minorities and women who apply and participate in Construction Trade Apprenticeships, 2) require local trade committees to develop new affirmative action plans every 5-years, 3) monitor compliance with state requirements to use apprentices on state contracts and 4) give apprentices 180 days to sue for discrimination.

First, you have to admire Wisconsin for going even this far. They actual use the word "Affirmative Action".  And they did created the report which exposed the discrimination by the labor committees.  It is hard to imagine any sort of follow up now that Scott Walker-R is Governor of Wisconsin.

Minorities and Women have long been closed off from participating in these valuable apprenticeship programs. The lack of access is due to pure discrimination: both historical and current.

Few states and cities and been able to do much about the issue due to the "tyranny of the majority" (Tocqueville, Guinier). Essentially, certain types of policies require the support of the majority to be workable. Policies to reduce discrimination are frequently thwarted by a majority who believe minorities increase competition for jobs, lower wages, and steal jobs from non-minorities.  Many construction workers also have a sense of "entitlement to employment"  not seen in other job categories.

So, this is about three years to late, but hats off to Wisconsin's department of workforce development.

v1.

Remarks by Alan Kruger on Rock n' Roll Economy

Alan Kruger, Chairman of the Presidents Council of Economic Advisers, discusses how the US economy has changed using musical artists as example.  It's an interesting example but very short on what to do about the market dynamics of the recording industry or what role government could play in helping artists who don't make it big.

Remarks by Alan Kruger on Rock n' Roll Economy

Senators propose amendment "to hire Americans before hiring foreigners on work visas."

Here is an immigration story that got no coverage.  Senators Sherrod Brown of D-Ohio and Chuck Grassley (R-Iowa) proposed an amendment to the immigration bill that would create a legal requirement that US companies hire American citizens before hiring foreign visa workers.  The amendment would also require companies to pay prevailing wages.

The H1-B Visa program has come under a lot of scrutiny lately because of high unemployment rates during the recession. The top 10 companies using H1-B visas are all outsourcing companies and they take more than 50 percent of the H1-B visa quota.

The H1-B visa program was supposed to be a short term fix for shortages in certain labor categories like software engineering and chemical engineering.  Instead it has been taken over by the outsourcing industry.  Much the way companies shed cafeteria and maintenance staff during the 1990s, they also shed IT staff during 2000s. The outsourcing industry is led by large consulting companies like IBM, Accenture, Infosys and EDS.

The amendment had the opposition from the business community for several reasons: it would raise labor costs of H1-B visa workers, it had enforcement provisions which would create a risk of non-compliance, and it would increase administrative cost.

Senator Sherrod Brown Press Release: Give American Workers a Fair Shot at High Skilled Jobs.

Senator Grassely works to eliminate fraud and abuse in H1-B visa program.

Cleveland Plain Dealer / Cleveland.Com: Sherrod votes Yes. 

The proposal is very much in line with the proposed immigration policy of the Evil Black Economist blog.  The policy is that immigrant must be tied to the general unemployment rate and specific industry need.  Guest worker programs like the H1-B visa program is needed but many companies are abusing the program to lower labor costs.

Second, the H1-B visa program ultimately stunts US long term competitiveness in an important and high paying sector of the economy. The consulting and outsourcing industry had deterred the entry of US workers into tech industry by reducing wages, requiring more experience and specialization and reducing R&D and training.

Thirdly, the reality of improved IT productivity for business is much more complicated. Business has saved much less money than they initially though while IT quality has slipped. Most of the excess profit for IT has instead gone to the large consulting companies and outsourcing firms and their owners and partners. Very little has gone to IT innovation, new IT products or new IT supported processes.

The amendment from senators Grassley and Sherrod is good balance between labor and business interests.  The amendment may appear again when the house of representatives debates immigration reform.

Defense and the National Interest: How to understand defense spending

The website Defense and the National Interest which is now hosted by POGO: The Project on Government Oversight, has a great series of in-depth articles on defense spending.  The articles cover how the priorities are set, how programs are evaluated, and how the money is appropriated and finally spent,

The ten articles together are called the Pentagon Labyrinth.

NPR: Black Unemployment

NPR had a story on Black Unemployment called, "Job Searching While Black: What's behind The Unemployment Gap ?"

Washington Post: North Carolina Tries Austerity

In North Carolina, unimpeded GOP drives state hard to the right.


I am glad some state is trying the Austerity path. The US is designed to support state level experiments with governance and this is one of them.  The Democrats have California.  So we will see which one does better.

The issue I have is that we cannot even agree on the goals.  Democrats will measure reduced unemployment, increased income after total taxes, reduced income inequality, increased life span and educational test scores. The GOP will measure total income growth, average income tax rate and total business investment.

AOL: Fast-Food workers strike in Milwaukee

Last week fast food workers in Milwaukee staged a strike. AOL covered the story in "Fast food workers strike 5th major city."

The Entrepreneurship Industry: Another annoying down side of US capitalism

There has been an explosion of entrepreneurship programs in the US.  It looks like everyone has some sort of "start-up" program, incubator or resource web-site. It's like everyone is trying to hit the lotto and a who industry has developed to sell people tickets and in some cases even "lucky" numbers.

Here are some examples:

Google has site focused on Entrepreneurship called Google Entrepreneur.
So does the City College of New York but on Facebook. Here is the link. 
There are also website that let you create business model like LeanLaunchLab.Com.

But you have to ask how much real, new value add are they creating and how much are they just stealing from one another. All this talk about entrepreneurship is great but it seems like a lot of "fake" PR with lots of smiling young people talking about "doing" good or "risking it all."

The truth is most businesses fail.

Another difficult truth is that the US economy is really a zero-sum game.  In order for you to get rich, someone else has be lose money or income. Despite what people are sold, money does not come from thin air.  It comes out of other peoples pockets.

And large businesses, especially retail, incredibly efficent at removing that money from other peoples pockets. Big box retailing has grown faster than the GDP for the past 30 years.  They have put department stores and mom and pop retailers out of business.  The competition is strong and vigorous   While average customer incomes are flat for the past 30 years.

So, lets be honest, in order for some business to succeed others must fail.

The real key in any business including small start-ups is a defensible niche; a natural or created monopoly that allows the owner to enjoy surplus profits. That can be the corner delicatessen  the local auto-repair business, a mid level medical instrument manufacturer or Amazon.com. (Ed. Note: It was really hard coming up with a mid-level factory example, they all have been pretty much wiped out)

UK Independant: French elite hold country back

The Independent has a story about the French elites holding the country back so they can prosper. They ask the question: "Is French elitism is holding the country back"

An interesting and simpleminded question, but fun to ponder.

He is promoting his book.  They always are that uses a small data set of French government officials.

As we always say, the real story is much more complex  First, even the premise of the story is wrong.  What exactly is the country being help back from ?  Are missing out on some great piece of pollution or low paying job that other have ?

What they don't say is "Growth" and that they believe Growth lead to prosperity.  And prosperity for who ?

Same old story.

UK Guardian: United Kingdom companies make heavy use of off shore tax havens

We are supporting the UK Guardian.  They continue to draw attention to abusive off shore tax havens that let British companies pay less than their fare share of taxes.

The story, UK Companies prolific use of tax havens, is here.

Joint Economic Committee report on long term unemployment (LTU)

The US Joint Ecomonic Committe of the US Senate and the US House of Representatives released a report on the long-term unemployment.

The summary is here.

The detailed report is here.

The report was released to coincide with hearings on long term unemployment in the US.  The hearings were notable because only four committee members attended (only one was present at the start) held in Washington this week.

The Huffington Post has the story here. The story has no by line so we are looking for the original source which is probably AP.

The economist debates Affirmative Action (AA)

The Economist magazine is debating Affirmative Action in a Oxford Style debate format here. The two debaters, Dr. Ashwini Deshpande, of the University of Delhi, Economics Department and Lino Graglia of the University of Texas School of law, establish their position and then debate the issue in the magazine piece.

Ms. Deshpande gives an overview of when affirmative action might be neccessary and how it has benefited India and Malaysia. She talks about societies where equality exists "in the law" but not "in the facts" and how affirmative action can be used to offer the disadvantaged opportunity.

Mr. Graglia gives only a narrowly focus rebuttal rejecting race as a factor in US affirmative action. He also completely ignores any of the arguments from Ms. Deshpande.  He does not mention any other form of AA, any other country or situation.  He simply states that discrimination is wrong. And then returns his opposition to race based affirmative action.

The posted voting and comments are based on the readers ideological lines.

Gallup Poll: 150 million would migrate to US if they had the chance

In a Gallup Poll from last year, 150 million people around the global said they would like to migrate permanently to the United States. The Gallup Poll and story are here. The issue is important for immigration because the US cannot accept everyone who wants to move here.  Also, immigrants depress wages for existing citizens whom they compete with.

Race at Work: The realities of Race and Criminal Record in NYC

Devah Pager and Bruce Western did some great work in 2003 using job testers in NYC.  They used identical testers who were different only by race: black, white and Hispanic.   They then added the variable of a criminal record with a felony conviction.

The testers were choose for similar background,  appearance, and verbal skills.  The testers were also coached to use similar self presentation styles.  They went to 1470 interviews. They were then matched to fictitious resumes with high school diplomas and solid work experience

The results were indicative of significant racial descrimination.

23% of whites were offered a job or a call back
19% of Hispanics a similar positive response
and 13% of black got a good response

The report is here.

Bloomberg News: Racism helps create fiscal distress in cities

David Unkovic, who recently resigned as the state imposed city manager  of Harrisburg, PA says the racial segregation is forcing cities into fiscal problems. The story from Bloomberg is here.  Essentially racial segregation has trapped poor people into cities limiting cities ability to raise tax revenues.  Harrisburg is 70% black and surrounded by lily white suburbs.

NY Times: Good college drops commitment to the poor

David Leonhardt writes and important story in the New York Times called "Better Colleges Failing to Lure the Talented Poor"

Teachers to open seafood restaurant and employ students

Two Bronx high school teachers are opening a new seafood restaurants and will employ students from local schools. DNA-Info NY has the story here. Basically the two guys are putting their life savings to a restaurant to teach entrepreneurship and financial responsibility.

WPIX-11 New York also featured the men.

The restaurant will be called the "Fishnet Seafood Cafe" and is located at 474 Willis ave in Mott Haven, The Bronx, NY

Newsone: Discrimination in hiring still a huge factor in Black Unemployment

Many people are talking about the Newsone.com story on employment discrimination. Lynette Holloway writes about the reasons for black unemployment including discrimination and government inaction.

She also discusses Rachel DiTomaso new book "The American Non-Dilemma: Racial Inequality Without Racism, Russell Sage Foundation" which covers "opportunity hoarding" by whites improves their life chance by pushing others down.  Yet whites do not see their actions as discrimination.

Ms. Holloway also reports on the lack of action by President Obama and other government officials toward programs that create jobs.

Calvert Investments: Few women and minorities in big corporate jobs

Calvert Investments has released a report documenting few women and minorities on the Standard and Poor's top 100 corporate boards or executive positions.  The report named: Examining the Cracks in the Celiing: A Survey of Corporate Diversity Practices of the S&P 100. 

The report

US News: US Military spends nearly a $1 Billion a year on Unemployment

US News and World Reports describes a program that pays ex-servicemen unemployment if they cannot find a job.  The money comes from the Pentagon budget.

New York Times: Companies put applicants though the wringer

The New York Time's star economic reporter Catherine Rampell has a great feature about employersdisrespecting job interviewee's during the hiring process.  The NYT story is here. The comments are also telling as the Times asked readers to post their interview horror stories.

Daily News: Mobile Black Business Locator Application

The NY Daily News has a feature here on a new application that will locate Black Businesses.  It's call "Around the Way"  and is a application for IPhone or Android phones.  

Unemployment Stories on Gawker

Gawker has been running a series of posts from unemployed workers called "Unemployment Stories". They are in a section called "Hello from the underclass".

Washington Post: Black Economists see bad news

African American Economic Summit at Howard University

The Washington Post has a story on the Back Economic Summit held a Howard University on February 1st, 2013.  It was sponsored by the Joint Center for Political and Economic Studies and Howard University.

The WP story is here.

Bad Jobs at Amazon

More bad news on how amazon treats workers.  This time the Financial Times of London has a long piece on a new amazon warehouse in Rugeley, UK. The FT's writing is called "Amazon Unpacked".

It looks like there is no downside to Amazon's corporate behavior when people want jobs. But ultimately is it worth it.

Proposal to increase H-1B Visa's to 300,000 from 65,000

The Hill newspaper report's that several lawmakers are proposing to increase the number of H-1B visas from 65,000 to 115,000 and possibly has high as 300,000.  It would also remove country specific limits.
The Hill's story on H-1B limits is here.

H-1B visa's are used by large technology corporations to recruit skilled foreign born workers for jobs that cannot be filled with US citizens.  Many people believe the programs helps the US economy grow by plugging key gaps in the US labor market.

Others believe the workers take jobs from US citizens and steal talent from developing countries.

Corporations like the program because they can reduce costs by paying foreign workers less than comparable US workers.

Here is a longer piece from the Government Accounting Office reviewing the H-1B Visa program in 2011.  GAO H-1B Visa program report.

Stories on Wage Theft (Non-payment by employers)

Here are a couple stories on employer non-payment which is wage theft.  In These Times has a long story on  "The Wage Theft Epidemic". One study by by the Iowa Policy Project called Wage Theft in Iowa: An Invisible Epidemic estimates that $600 million was stolen from Iowa workers and $60 million from state government accounts. The story also covers states cutting enforcement staff.

Pro Publica: Does job training work

A great long-form piece in pro-publica reviews the effectiveness of job training after mass layoff in Janesville, Wisconson.  The piece determines that workre in job training after the layoff had lower levels of employment and lower wages.

The article called "Rare Agreement: Obama,Romney and Ryan all endorse retraining for the Jobless -- But are they right." by Amy Goldstein.

Brookings: Economic Effects of Immigration

The Brookings Institute has a good piece on immigration called "The Economics of Immigration Reform," by Michael Greenstone and Adam Looney.

CCAP: 48% of workers over-educated for their jobs

The center on College Affordability and Productivity release a report in January 2013 detailing that the workforce may be over educated compared to actual job requirements. The paper, called "Why are recent college graduates underemployed." is here. 

There are several highlights in the report.

We maybe over investing in college education. While the pay premium due to a college education is large, not every will find a good paying job.

College education may not be the answer to rising unemployment or increasing earnings.

One is that 48% of recent college graduates are in jobs that require less than a college education.  Eleven percent require less than a college education and 37% require only high school level knowledge or less.

ILO: Global Unemployment is Rising

The International Labor Organization release a report called "Global Employment Trends 2013". The report notes a second dip in employment due to the global recession of 2007.

Here are some hightlights

Half of the new unemployed (28 million) in 2012 were in advanced countries.

There are an estimated 197 million people unemployed globally.

BBC: Grace Amey-Obeng's beauty company in Ghana

The BBC story of the Ghanaian Beauty Company FC Group is here.  The owner trained in "beauty therapy"  in the UK then returned to Ghana.  She started giving advice on skin cremes and then created a product for the lower priced market.

The stories comes from the BBC series African Dream which shows how one successful business person developed their business in Africa.

JEEP (Jamaica Emergency Employment Program

We are reading about JEEP (Jamaica Emergency Employment Program) which is a job creation program.  The program will provide employment to 5000 Jamaicans at a cost of US$45 million dollars. The program was pushed for by Portia Simpson-Miller's People's National Party.  The PNP is the party of the left and the Jamaica Labor Party is the right of center party.  Under the JLP, Jamaica sponsored a similar porgram called JDIP(Jamaica Development Infrastructure Program) which cost US$400 million.

Jamaica has one of the highest debt to GDP ratios in the world (125%) and faces problem with crime and unemployment. Jamaica has approximately US $13 billion in debt or about $8000 per person.  In 2009 debt service consumed 65% of revenues.

The IMF restructured Jamaica debt in 2004 but has been unwilling, despite record low rates, to renegotiate again.

In 2010, the IMF agreed to a the Jamaican Debt Exchange(JDX) which exchanged high interest short term borrowings for lower interest, long-term debt.

Jamaica economy is small, service based economy based on tourism, remittances and buaxite exports.

Many believe the banks and IMF are making an example of Jamaica by not forgiving or restructuring it's debt.

Jamaica is a middle income developing country which has seen either zero or miniscule GDP growth for the past 20 years.

The UK guardian has a story on Jamaican Debt Crisis here.

The 2012-2013 national budget of Jamaica is here from the Gleaner.

Jamaica Debt Exchange press release from UNDP.



Sources:

CIA worldfact book
IMF
World Bank

ShoreBank

This is an old story I just discovered.  ShoreBank, the nations largest community development bank(community development financial institution[CDFI]), was declared insolvent by the FDIC on August 20, 2010.  The bank was well known for making loans on south side of Chicago.

The bank had a dual mission to serve the community as well as make a profit.

To quote the FDIC press release: "Shorebank experienced asset quality problems that centered on residential rehabilitation loans (single and multi-family) and condominium conversion loans.  Loan and operational losses depleted capital to the point where the bank was no longer viable."

Here is the FDIC press release.

The FDIC Information is here.

Crain's Chicago Business is here. Crain's story is about $100 million loss in 2010 and 2011 after $100 million dollar loss in 2009. Crain's also had a link to and FDIC audit in 2007 warning the bank about deteriorating loans. Here.

ShoreBank was acquired by Urban Partnership Bank.

And if you are really losing sleep, here is the purchase and asset assumption document, "the deal", between the FDIC and Urban Partnership Bank.  Basically, the FDIC take 80% of the loss on the bad loans.  The agreement is here.

Cuddly or Cut-Thoroat Capitalism

In the US, you would never know it, but there are different kinds of capitalism. In the US we have more conservative, individualistic, winner-take-all type with limited government. Some call this "Cut-Throat" capitalism. Other countries operate by the same market principles but provide a stronger social safety net and more government activism in the marketplace. Their version of capitalism has come to be called "Cuddly Capitalism". Most of the "cuddly" countries are in Europe especially Scandanavia. Many promoniant economists are debating which type of capitalism is more innovative. And also which one provides more growth. The VOX website has two articles: Cuddly vs. Cut-Throat Capitalism featuring the work of prominant economist Daron Acemoglu. A second debate centers on growth and innovation. Are nordic countries less innovative ?

Economist: Kibera (Kenya) slum is economic hotspot

The economist has a nice and positive story about economic activities in the Kibera slum in Nirobi, Kenya. The story called "Boomtown Slum" is here. The story details much of the daily life and economic activities in Kibera. Is skips over the ethnic clash, gangs, and missing government services.

Improving US manufacturing: Jan 2013

The Joint Economic Committee of the US Congress released a report on US Manufacutring Policy. The report lists some non-controversial ways the government can support manufacturing in the US. The report: Manufacturing in America was released in January 2013. The proposal are: 1) Improve education and training in Science, Technology and Math 2) Expand transportation infrastructure 3) Provide tax incentives such as r&D tax credit or acceralted depreciation. It also mention a credit for US based manufacturing. 4) Enforce intellectual property rights 5) Encourage China to stop undervaluing it's currency

Obscure Reference of the Day: PENBOTEC 400 -- Fruit preservative

Ever wonder why food and fruit don't spoil any more ? Because they are made with or covered with preservatives like Penbotec 400 from Janssen Pharmaceutical, Belgium. Penbotec 400 is a spray on fruit preservative with pyrimethanil which is a broad spectrum fungicide. We won't comment one whether it's good or bad. However, we will tell you to: Always wash your food !!! Including meat, vegetables, and fruits. We were looking at Penbotec 400 because it appears in a bill to temporarily waive the import tariff. The house routinely waves tariffs on imported chemicals as a favor to importing companies in their home states. The companies lobbyist then make a campaign contribution to the candidate. The house bill is here. Tax payers for Common Sense has an excellent database of all the tariff waivers proposed for 2012. TCS database of tariff waivers is here.

Government Job Creations Works but is Difficult

The Evil Black Economist Team has long been in favor of government creating jobs for the unemployed. Job holders learn, skills, pay taxes, are happier, have better self esteem and use less government support. The government should be the "employer of last resort". In the US the federal government created jobs during the depression. All jobs have some make work component. Restocking a return, fixing an error and preventing a mistake. However, some jobs have a much larger make work component, Lots of municipal jobs can be classified as make work jobs. Jobs such as police, fire, security guard, homeland security, armed forces and litter collection add little to no true value to the economy. Other jobs like social worker have a medium sized make work component. A good test is when the job is complete at the end of the day: was anything created. Was anything lasting built. If the answer is nothing is built, nothing was created, no one was educated nor road constructed then it is a make work job. Our definition of a make work is a job with no tangible output. Or a job that prevents harm to people and property. Having said all that, we are in favor of make work jobs. Make work jobs are the most efficient use of resources by society while yielding the greatest overall happiness. Once society agrees to pay unemployment insurance to the unemployed and income support to least fortunate in society, one must ask what is the best way to spend the money. giving the money as a gift or letting people earn it. Clearly, helping people earn the money is a better choice. Developing such a program is incredibly difficult, complex and expensive. The benefits (higher taxes, skills, crime reduction) do not accrue to entity paying the bills. It also requires a level of long term thinking that many government entities cannot handle. It sustained political support. The Labour Party of the United Kingdom came to a similar conclusion when it created the future jobs fund October 2009. The fund, which subsidized jobs for young people was a response to a very high youth unemployment rate in Britain. The program was cancelled by the Conservative government recently because of austerity. Here is a recent report analyzing the cost-benefit of the program. Impacts, Costs and Benefits of the Future Jobs Fund. The Guardian has a story summarizing the report which says the fund generated a positive return of 7750 British Pounds per worker in the program.

US Prison Statistics for 2011. 1% decrease.

The US Department of Justice released it's annual survey of the prison population. The number of prisoners at the federal and state level decreased from 1,613,803 to 1,598,780 a difference of about 15,000 or a less than 1% decrease. Prisoners in 2011

NELP: Mid-wage jobs have yet to recover

The National Employment Law Project confirms so sad news we have all suspected. Most of the jobs created since the recession have been low-wage jobs. About 60% of the jobs eliminated were mid-wage jobs yet only 22% of the new jobs were mid-wage. NELP report is here.

Ten States Increased their Minimum Wage on January 1st, 2013

The following states increased the minimum wage above the federal minimum wage (FMW = $7.25) on January 1st, 2013.  Only Vermont, Oregon, and Washington State offer minimum wages that are significantly  (20% or above) above the federal minimum wage.  The rest are withing 8% or less of the FMW.

You can only hope states are setting the stage for future increases. It is good to see some traditionally conservative states like Arizona, Florida and Montana raising the wage.


Vermont          $8.46 to $8.60
Rhode Island   $7.40 to $7.75
Arizona           $7.65 to $7.80
Colorado         $7.64 to $7.78
Ohio                $7.60 to $7.85
Oregon            $8.80 to $8.95
Washington      $9.04 to $9.19
Montana          $7.65 to $7.80
Florida             $7.67 to $7.79
Missouri           $7.25 to $7.35

The current federal minimum wage is $7.25.

Vermont's minimum wage is indexed to inflation and the cost of living.

Washington State has the highest minimum wage at $9.19 per hour. It is indexed to inflation.  It was created by a voter initiative 688 approved in 1988. 

Anti-Lobbying Site: American Anti-Corruption Act

Here is a site that wants to severely restrict lobbyist influence on politicians. It bill they propose would limit donations, expand the definition of a lobbyist, and impose more stringent rules on lobbying.

The American Anti-Corruption Act.

Everett and Jones Barbecue Restaurant in Oakland, CA

I saw Everett and Jones Barbecue on Nightly Business Report which had a nice puff piece.  I read some of the review on the internet and one dogged the place out.

Everett and Jones Barbecue

Cleveland Fed: College pays only a little more than high school in some fields.

There has been a recent slow down in wages for college graduates.  Many graduates are finding it hard to start their careers in their chosen fields.   Jonathan James studies the difference in wages based on college major.  Engineering comes out best.

The college wage premium by Jonathan James

Cleveland Fed: Labor's Declining Share of National Income

The Cleveland Fed has a piece on labor (vs. capital) receiving a declining share of national income.

Labor's Declining Share of Income and Rising Inequality by Jacobson and Occhino.

Traditionally labor income ad benefits have received about 2/3 of all national income and capital has received 1/3 of national income.  The article supports the idea that for the pass 30 years the returns to labor have been dropping. The result is flattening wages and increasing income inequality.