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UNEVEN AND STAGNATED WAGES IN 2014 – WHAT OUR FUTURE COULD LOOK LIKE

February 26, 2015

UNEVEN AND STAGNATED WAGES IN 2014 – WHAT OUR FUTURE COULD LOOK LIKE

There are many sub-measures of wages but few are described by the media, which rarely goes beyond topline descriptions of how many newly employed have been added to the workforce and similarly bland general assessments of wages and the labor market. Feeling conspiratorial today, I offer the following in explanation for such serial failures to more deeply inform: The media do not look under the hood for the overall wage story; the financial press looks instead for headlines and “feel- good” editorial content, headlines that as published deliberately mask an economy far from healthy, all perhaps typical of corporate cheerleading designed to keep the general public relatively uninformed and thus further its  continuing design to impoverish labor and increase profits, areas joined at the hip and culminating in corporate balance sheets, and all without substantial detection by a public preoccupied with survival.

Thus while we have had recent recovery in job growth, we are being short-changed by the media in describing the good news. Why? Because the fact is that from 2013 to 2014, real inflation-adjusted hourly wages STAGNATED AND FELL ACROSS THE BOARD (with one insignificant exception involving a few of the ultra-skilled), and further, even if such overstated good news continues to see 2014’s average rate of job growth, it will still be 2017 before we return to pre-recession Bush Great Recession labor market health. Where do you read such downers as that in the financial press or hear discussed on business TV? (The foregoing extraction of unslanted fact as summarized is from an excellent piece written recently by economist Elise Gould of the Economic Policy Institute.)

Decent wage growth and decent job growth do not necessarily move in tandem; quite the contrary. The old assumption that more people working make more money because there is increased competition for their services does not hold any more. Why? There is still too far much slack in the labor market; there are still far too many people not working, and it doesn’t show up in labor statistics as a matter of routine but is rather information that must be teased out of the Labor Department’s archives.  Indeed even with fairly robust increases in employment over the past few months, the unemployment rate has gone UP instead of down. Why? Many people who had given up looking for a job came back into the labor market, thus leading to the seeming anomaly of earning LESS while one’s services are MORE in demand.

The idea of increased demand for services is a relative one, and employers are thought not to have to raise wages until the slack in employment is absorbed. As a result employers are hiring people and are REDUCING wages during 2014 at the same time in a worrisome trend they are not likely to want to correct and it appears (with an occasional exception for needed skills they cannot outsource or bring immigrants into the country to perform) that wage inequality will run all the way to “full employment,” and perhaps beyond as corporate employers find new ways to underpay American labor and overpay their executives. When and if we ever reach “full employment,” we will see what their new excuse is for their continuing impoverishment of American labor and innovative PR cover for their unmitigated greed.

Perhaps (in order to avoid the loss of aggregate demand in this country due to slave wages paid to Americans) such employers will export American-made goods to countries where employees make decent wages, have universal health care etc., and can therefore afford the goods and services we produce here, much like underpaid Chinese labor has furnished American corporations cheaply-made goods for our consumption here for the past 20 years or so (damaging our domestic economy greatly and permanently in the process as greedy wage inequality brought to America by peasant wage and other competition by American corporations seems to have trumped America’s future and its people).

We Americans would under such a scheme as here proposed receive near-Chinese wages of old while our American corporations would make enormous profits in trading our cheaply produced goods to well-to-do countries where employees make sufficient income to consume cheap American-made goods and services, goods and services we cannot afford here due to apparent adoption of wage inequality as policy by bought politicians leading inevitably to my greatest fear today – the total  and final corporate 1984-like  control of all of America’s institutions, economic, political and social.

The ultimate irony would be, of course, if we corporate-controlled Americans wound up manufacturing goods for rich Chinese consumers in our sweatshops, a real possibility given our current trajectory toward Third World status and the Chinese move up the economic ladder. Can’t possibly happen here? Far out? Divorced from reality? That’s what the British and the French said about the loss of their “Empires” and the Russians said about their “Sovietized” republics within the twentieth century, some of which played out in our lifetimes. Things change. History is driven by events in real time. Those then potential events were contemplated to be “far out” at the time. They happened. Things do.

Can this or something like it be our future? What are we going to do about it? Anything? Are we just going to abandon our country that we fought and bled and died for and hand the remainder of our blood-soaked democracy over to the rich and political class to do as they will as we voluntarily submit ourselves to a new form of feudalism (aka slavery)? I hope not.

It is long past time that we run this country as a democracy and ridded ourselves of the political weasels and any and all special interests who pretend to know what’s best for America while filling their own pockets. That is a decision we the people will make as we run our own economy and government paid for by the blood of martyrs in such places as Valley Forge and Gettysburg. We know how, and even if we (as did Washington, Adams, Jefferson and Madison) have an early rocky course, we could not possibly run a worse ship than the ones run by the weasels and their greedy cohorts now, so let’s get on with it.  GERALD   E

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