Saturday, July 28, 2012

total all levels government spending

once we got into kold war stride it was  fairly constant eh ?

till the post S= kamp collapse and the clinton frugal miracle
then gwot another squeeze down  this one largely local

note : transfer payments are not included

speaking of tranfer payments

lookeee here

transfer payments as a share of personal incomeSource

Thursday, July 26, 2012

PK drowns out the latest honks of the serious straw man brigade

who  among us  is so mind funked
   as to still not   knoweth
the   tax foundation
 is a  plutonic   US prime center cut
        reactionary kazoo ?

its sole offering
a brand  of k street casuistry
 doubled charged with horse feathers and fact twists
 and then honked away
day and night
             in the key of d flat

   a mischievous  blue ribbon noise box

in the latest issue
  these  well heeled counter revolutionary cads
 sally forth   yet again
   to  play ace water board team 
and  of course
 its the  hapless  "gold standard " CBO data base
that  confesses to  another
   in a very long  and very  crooked series
                          of fourth tier of hell  lies
                                                  damned  statistics

the task  scotch  the  persistent rumors of growing income inequality

thank heaven  we can trust in  every industrious  truth  terrier PK
  to  rip out the rotten stuffings  of this nasty new business section chew toy

but first the brutalized  TF  facticular discovery  :

yup inequality is ...trendless
'the grand dragon of  ship to shore liberty
ronald delano  reagan
 evacuated the  corporate exploitationary  forces
  from  the  late 70's   mindless  profiteers  spiral
into a "dunkirk "
----  caution:
             purple is the color of sugary pink
                                                  business historiography ---

pk responds
"the whole post is kind of a classic of disinformation: pretense that income taxes are the only taxes? Check. Bemoaning the rising share paid by the rich, while ignoring their rising share of income? Check. Whining that the lucky duckies with low incomes don’t pay enough? Check."

and he hurth forth this clarion all of the real down town long haul  truth :

voila the terrible  ride of the  top .01-ers:

i see trends
do you see trends ?
to read  all :

Wednesday, July 25, 2012

chinn music chimes to project prometheus

lets just burn up the debt  slowly !

"reducing the debt burden through

inflation would be simple and across

the board — and, unlike a formal

restructuring, would not create a

circus of interest-group politics

that alienated the public and opened

the door to bank runs."

read this and you will free your mind !!!!

Monday, July 23, 2012

Wikipedia on the Causes of the Great Depression

For those who are interested in comparing and contrasting the current Great Recession with the Great Depression, Wikipedia has several interesting articles on the Great Depression. They are fact-filled; for instance, we were surprised to learn that in 1933 a group of millionaires, led by the Du Pont and J.P. Morgan empires, and alarmed by Roosevelt's plan to redistribute wealth from the rich to the poor, plotted to overthrow the Roosevelt administration by means of a military coup "and install a fascist government modeled after Mussolini's regime in Italy." Fortunately, the general whom they recruited to lead the uprising ratted on them to Congress. Since then, I suppose the would-be fascist businessmen have consoled themselves with fomenting military dictatorships abroad, in Latin America and elsewhere.

Wikipedia has a long, fact-filled and quite theoretical discussion of "The Causes of the Great Depression." It notes that some economists at the time (and later John Kenneth Galbraith), "popularized a theory that had some influence on Franklin D. Roosevelt. It held that the economy produced more goods than consumers could purchase, because the consumers did not have enough income. According to this view, in the 1920s wages had increased at a lower rate than labor productivity. Most of the benefits of the increased productivity went into profits, which went into the stock market bubble rather than into consumer purchases. Thus the unequal distribution of wealth throughout the 1920s caused the Great Depression.

"According to this view, the root cause of the Great Depression was global overinvestment while the level of wages and earnings from independent businesses fell short of creating enough purchasing power. It was argued that government should intervene by an increased taxation of the rich to help make income more equal. With the increased revenue the government could create public works to increase employment and 'kick start' the economy.

"In the USA the economic policies had been quite the opposite until 1932. The Revenue Act of 1932 and public works programs introduced in Hoover's last year as president and taken up by Roosevelt, created some redistribution of purchasing power."

We couldn't have said it much better ourselves, except perhaps to point out that the solution we favor, or at least would put on a par with putting more money into the hands of government to fund public works programs – as well as infrastructure, education, etc. -- is a set of fair wage policies that would put more money into the hands of working Americans.

Tuesday, July 17, 2012

It’s the blow you don’t see coming that knocks you down

"The Coming Crisis" Last Time Around

In June 2005, Lewis Lapham of Harper's Magazine hosted a forum on "the coming crisis." The three discussants included Paul Krugman and Glenn Hubbard. Predictably, Krugman thought that "there is a 50 percent chance that the outcome is pretty calamitous"…while Hubbard said that "nothing in this story suggests to me any kind of imminent crisis."

Nothing remarkable here, right? Both pundits were just taking their standard positions, Hubbard the incrementalism of the Chicago style of economics, and Krugman a Keynesian approach. And one could then go on to attack Hubbard for being out of touch with reality and to laud Krugman for being prescient?

But economic ideology and economic reality are not so neat. The feared crisis they were talking about was NOT the bursting of the domestic U.S. housing-centered financial bubble and the ensuing Great Recession, but the much-anticipated crisis of the debt-burdened dollar. If we had disclosed that the third person in the forum was Peter G. Peterson, we would have given the game away, because he has of course been the most outspoken critic of the government deficit, and the most apocalyptic in his forecasts of the consequences of debt.

We now know what crisis these experts should have been focusing on at the time. In 2007, about two years after this forum was held, the U.S. housing market collapsed, taking mortgages and other risky assets with it, and by 2008 the whole U.S. financial system was in crisis.

By March 2009 U.S. stocks had lost half their value. But not the dollar! And not U.S. Treasury bonds! When risk spread from the U.S. to investments across the world it was, paradoxically, the dollar that was increasingly seen as a safe haven. And U.S. Treasury securities were seen as the least risky assets, not the worthless paper instruments of a state desperately trying to fund endless deficits, like some banana republic. Part of the reason is that, while Americans have been preoccupied with their own financial and economic problems, people abroad have placed more emphasis on the problems in other countries like the weaker members of the euro bloc, and seen the U.S. economy in a more favorable light as relatively stable , and Treasury bills and bonds as "risk-free" securities.

Consider the record of the last seven years. As regards U.S. Treasury debt, the interest rate on the 30-year Treasury bond has fallen, not risen. It has hovered around 4% for much of that period, and is currently below 3%. True, the U.S. dollar index, reflecting the average price of the dollar in other currencies, has fluctuated considerably, but as of today it is down by only 10% or so (from a level of about 90 in 2005 to about 80). Taking a somewhat longer perspective, the index had admittedly peaked at around 120 in 2002, and from that point it had already fallen by about one third (to about 90) by the time of the forum in 2005. But these declines were relatively gradual and orderly.

By no stretch of the imagination, then, has there been any kind of dollar crisis, and the debt crisis that occurred in 2007-2009 and caused the economic depression was not a crisis of government debt but one of household and private financial sector debt. From the perspective of mid-2012, Paul Krugman deserves lower marks than Glenn Hubbard in this debate, predicting a dollar crisis that didn't happen. And Pete Peterson comes across as Chicken Little; so far, the sky hasn't fallen, as far as debt and the dollar are concerned.

The Coming Crisis This Time Around?

But somehow one gets a feeling that the financial markets are hiding more than they are revealing, that all is not hunky-dory with debt and the dollar. It is not only a matter of the sluggish state of the U.S. (and world) economy. There is a growing sense of unreality in the current economic debates, which are mostly of a short-term Keynesian nature, focused on whether the amount of government stimulus is enough to get us out of the Great Recession, or whether the spreading call for "austerity" in Europe and the U.S. could soon take the world economy in the other direction, toward a second dip of the recession.

Meanwhile, while most economists have remained focused on the Great Recession, the federal government deficit has still been there, averaging over $2 trillion a year during the four years 2008 to 2011. And the international trade deficit (including other "current account" items) has still been there – averaging $500 billion a year in those four years. But the financial markets don't seem to care, with investors now willing to buy 10-year U.S. Treasury notes with a coupon of under 2%, and Treasury bonds with a coupon of under 3%. Since inflation is expected to run at 2 or 3 percent a year, it appears that investors have such confidence in the financial probity of the United States that they are willing to invest in its sovereign debt at rates that are not hardly expected to keep up with inflation.

In fact, the only people who seem to care about this situation are hypocritical Republican politicians who, after turning a blind eye to the profligacy of the Bush years, want to use debt as a stick to beat down liberal budget proposals and "starve the beast" of government.

Meanwhile, as in the early stages of a horror movie, we in the audience sense that the protagonists are in great danger, while they are going about their lives in blissful ignorance. Our friend Martin Kenner likes to say, "It's the blow you don't see coming that knocks you down."

Trying to anticipate the blow that we haven't seen coming, we ask the direct question: at some point, won't the world's creditors say enough is enough when it comes to lending to the U.S. government? The U.S. government deficit is extending as far as the eye can see, but as Herb Stein said, "If something cannot go on forever, it will stop." Won't it be more and more clear to lenders that this is a case of good money following bad? Won't they knock U.S. Treasury securities from their "Risk Free" pedestal and demand an increasing risk premium?

It seems that there are two issues that will determine the feasibility of U.S. fiscal policies in the medium term. One is whether there are or will be credible signs that the U.S. is shifting from debt-dependence to fiscal prudence, i.e., from cyclical deficit in the short run to structural surplus in the long run. And the answer to this question at the present time must be no. Right now, the federal government has a valid cyclical reason for continuing with deficit financing, namely of course the need to stimulate the economy and bring it out of the recession. But the magnitude of the recession is such that there seems to be no end to the need for fiscal stimulus. Accordingly, the need for deficit spending will remain.

But the calls for prudent fiscal management are bound to grow. The easy part is behind us. From here on, politicians will increasingly attack the government for running an endless deficit, and they will also, inconsistently, resist the need to increase taxes on the wealthy and on business to pay for it. It is always easier for Congress to spend money beyond the government's means than to raise taxes. If and when, finally, the time for raising taxes comes, will Congress – and the American people -- be up to the challenge? And will they try to put the burden on those who can afford it, rather than on the poor and the middle class, who are already struggling?

The other issue is the relative confidence that investors and governments have in the U.S. economy (and polity) compared with that of the other major currency blocs. Today, the euro is the dollar's chief potential rival, but Europe is in a state of deficit and disarray. However, it is only prudent to expect that if and when Europe begins to stabilize and the euro becomes a more respected reserve currency, there will be an increase in the cost of borrowing by the U.S. And what about the relatively stable Japanese yen? And the rising Chinese renminbi?

So, after all, it seems the U.S. must sooner or later experience a time of reckoning in which it becomes hard to find buyers for the dollar or for Treasury bonds. The dollar must fall and inflation and interest rates must rise. But it is hard to predict the timing and shape of these and other associated developments.

One thing is clear: it will become much more difficult to finance the U.S. debt, and fiscal responses to that problem could be crucial. Government debt could be a huge drag on the economy, just as private household debt is now. In other words, while exports should help to strengthen the economy, the debt load could severely depress it.


The kind of partial analysis presented here focuses on a few economic and financial variables, and there are many other variables that will affect the developments discussed here, and in turn will be affected by them. To the extent that we experience a large fall of the dollar, it is likely that U.S. import prices and inflation will rise. U.S. exports will be more competitive internationally and should do well. To the extent that interest rates payable on fixed-interest investments rise, the cost of borrowing by Main Street firms will rise, which must have a depressing effect, other things equal. And bond prices (which move in the opposite direction) must fall, and investors will lose a lot of money during the transition to a higher-rate environment. Stock prices may hold up, however, if exports and earnings are rising. Much will depend on the responses of other countries. If U.S. exports gain market share, and the U.S. fends off competitive imports, the U.S. will succeed in exporting recession, but the reverse will be the case if other countries competitively devalue their currencies and there is a trade war in which the U.S. loses market share. Clearly, there is a complex set of interactions here. Not least, the accumulated national debt could have a potentially crippling effect on the economy, despite the boost from exports. Hopefully, however, this brief analysis will provide an introduction to some of the issues.

states on "pension cola strip" rampage ?

take a look at the map...
posted by
human milk dud
timmy tinker :
pictured here after stepping on  the head of a  garden rake :

Sunday, July 15, 2012

Three Cheers for Joe Stiglitz

Joseph Stiglitz's new book, The Price of Inequality: How Today's Divided Society Endangers our Future. (W.W. Norton, New York, 2012) is a very important contribution to the debate about the harmful economic and other effects of extreme inequality. The book is broad and deep, and our quick review here will hardly even touch the surface. We would encourage people to read this well-written book in its entirety.

Stiglitz has no illusions about the way in which the market economy is working in the United States. He has lengthy discussions about rent seeking and market imperfections as sources of income of the 1%, and little confidence in the labor market as a mechanism for setting fair wages in the policy framework that has prevailed in the country in the last three or four decades.

Stiglitz's discussion (at pages 85 et seq.) of the harmful macroeconomic effects of inequality is worth quoting at length, because it decisively breaks rank with today's timid market economists:

It is perhaps no accident that this crisis, like the Great Depression, was preceded by large increases in equality: when money is concentrated at the top of society, the average American's spending is limited, or at least that would be the case in the absence of some artificial prop, which, in the years before the crisis, came in the form of a housing bubble fueled by Fed policies. The housing bubble created a consumption boom that gave the appearance that everything was fine. But as we soon learned, it was only a temporary palliative.

Moving money from the bottom to the top lowers consumption because higher-income individuals consume a smaller proportion of their income than do lower-income individuals (those at the top save 15 to 25 percent of their income, those at the bottom spend all of their income). The result: until and unless something else happens, such as an increase in investment or exports, total demand in the economy will be less than what the economy is capable of supplying – and that means there will be unemployment. In the 1990s that "something else" was the tech bubble; in the first decade of the 21st century, it was the housing bubble. Now the only recourse is government spending.

Unemployment can be blamed on a deficiency in aggregate demand (the total demand for goods and services in the economy, from consumers, from firms, by government, and by exporters); in some sense, the entire shortfall in aggregate demand – and hence in the U.S. economy – today can be blamed on the extremes of inequality. As we've seen, the top 1 percent of the population earns some 20 percent of U.S. national income. If that top 1 percent saves some 20 percent of its income, a shift of just 5 percentage points to the poor or middle who do not save – so the top 1 percent would still get 15 percent of the nation's income – would increase aggregate demand directly by 1 percentage point. But as that money recirculates, output would actually increase by some 1 ½ to 2 percentage points. In an economic downturn such as the current one, that would imply a decrease in the unemployment rate of a comparable amount. With unemployment in early 2012 standing at 8.3 percent, this kind of shift in income could have brought the unemployment rate down close to 6.3 percent. A broader redistribution, say, from the top 20 percent to the rest, would have brought down the unemployment further, to a more normal 5 to 6 percent.

Stiglitz explains how the government's response to weak demand – low interest rates – led to bubbles in tech investments and housing – how deregulation made things worse, and how what we now call "austerity" has reduced government spending, the reverse of what was required.

One should note, however, that Stiglitz's argument on the effects of inequality is more descriptive and less analytical than that of Michael Kumhof and Romain Ranciere, which was reviewed on this blog on May 15: Inequality, Leverage and Crisis, IMF Working Paper WP/10/268, November 2010. Their paper really nailed the issue by developing a model that traced the causation from inequality to leverage (excessive mortgage borrowing) and crisis when the mortgage bubble burst.

A footnote on the OECD Economic Survey of the U.S.

The OECD's June 2012 Economic Survey of the United State contains a much weaker discussion than that of Stiglitz or Kumhof and Ranciere. It is agnostic regarding the macroeconomic damage caused by inequality, concluding that "there is no consensus in the economic literature that reducing inequality would be harmful to economic growth." Which falls short of a finding that reducing inequality – at least, reducing extreme inequality -- would actually be beneficial to economic growth, as clearly shown by Stiglitz, and Kumhof and Ranciere, and argued in the founding paper of this blog (see Home Page, click on "Read the Paper").

Needless to say, waiting for consensus on inequality among wobbly-kneed economists would be like waiting for consensus on climate change or the theory of evolution among Kentucky Republicans. The closest the OECD gets to the nub of the recent problems is the half-hearted statement that "Some have identified income inequality as one of the causes of the financial crisis since it may have encouraged subprime borrowing by households who tried to make up for their lack of income." It does not mention the complementary problem that the excessive savings of corporations and the wealthy provided the supply side of the subprime bubble, and the way in which the Fed enabled the growth of unsustainable subprime mortgages by its policy of easy money and lax regulation.

we just don't wanna work so much anymore ?

index for all:
the  level in 1995 :

check out that orange line

that's the geeter with the heater:

                   "the employment to population ratio"

the rest is all corporate market capitalism
              doing its 'one damn thang after another' act

enlargement :

Saturday, July 14, 2012

sieze all the corporate pension funds now

some of us have called on  uncle for years  to take over
  all   our  existing corporate sponsored  ' defined benefit 'plans

take em over
 assume their obligations 
  and tax the bejesus out of their former "corporate managers "
like those hideous profit pots are a bunch of  18th century french peasants 


we citizen enrages
need to  rebuild the federal back stop system with fat hacked off the corporate haunch ;

  The Pension Benefit Guarantee Corporation (PBGC) is in trouble and headed for a lot more

right today  we need to stop the  board room clip joint operations
   that run their pension obligations thru a chapter 11 bankrupcy court
                                      and from there right out of existence

poof  gone !

 like  promises to the natives by  a settler community
that's where the PBGC comes in
to pick up the obligation ...but only in part of course
--operates much like fidc for despositors
theres's a limit to the coverage ---

the day of the corporate fringe massacres is at hand and has been at hand
 for over two decades now
   and  in a growing crescendo of court ordered slate wipe offs  rip outs and vanishments

this is obvious to all of us looking into the crater where once union contracts existed

 but uncle  stepping in now and taking over prior to court action
 ..ya i mean uncle  coming in pre emptively
putting  a stop to this ending a hideously uneven bloody faced bout ...

        friends it 's certainly  well past due

the longer uncle lingers the  more fringe fucks.... the more ruined retirements

and yet  as with most
recent "ought versus is  " state  plays

uncle is heading in exactly the oposite direction:

"On Friday, July 6, President Obama signed into law a bill that would renew transportation programs and extend low interest rates on student loans for one year. ..
 tucked away within the bill’s pages was a little-noticed proposal to further erode the funding of workers’ pensions. ...This bill in a brilliant sleight of hand  ...
            REDUCED  the amount that corporations pay
                                        into their  grossly underfunded pension systems"

 read more at the  counter punch link above .....

behold biff reynolds !

looking like a parady of one of his patrons
much like a dog comes to mimic  its master i guess

i find it great fun to occasionally note
 this  notorious slippery eel of a rich man's hack at work

"love ya biff
hows the kidney stones?"

he of the now long since famous
reynolds numbers on the turbulence in the flow of truth
produced by water boarding  household  income data 

read it.. u can get a fine sense of the confessional  art
  of number racking

you know i read stuff like this about the great out there
  and i figure we must have a parallel earth

a  bizzaro gold plated  earth
with shiny  friendly plutonian features
okay its much  unlike here
where the face of a plutonian
 can pretty much everytime
  scares  the wits
  out of   charging  He- Bear

take this sardonic clincher from our sincere reporter mr biff
beaming an update to us
   from our  twin earth ....planet plutonia :

"Perhaps it is time for the CBO to issue a corrected report:"
 “The share of income received by the top 1%
                                fell from 11.8% in 1985 to 11.5% in 2009.”

gotta love that   for its understated  "right up yer  ass"  ism

for the anbitious fact moles among u
  here's the eclairlike  " back bone " to reynolds latest shimmy dancer :

prologue begins:

" The U.S. economy has grown considerably over the past three decades. However, there is a prevailing sentiment that the middle class and the poor have been left behind"

can you guess where this unvarnished enquiry into the hard facts
           is headed brothers and sisters ?

to refute all the stuff like this
churned out by our nation's donated tax exempt
           dollar mill stink tanks

    would indeed daunt the stoutest sewer  voyageurs
                                                                     among us pinkos

to  effectively
     tit for tat
battle  every   " issue paper  " produced
                           by  these  cork screw outfits ..yikes !
what with their non stop
    pay out of  seriously  good money
     to  literally hundreds and tens of hundreds
                  of  these  eager  scurrying  thousand legged
                                                        hack-cademy scholar-creepees  .....

why my lord
   that would require
               a full time staff of  prolly 100  furiously scribbling beta level red angels

not really worth the effort for us mortal slobs eh ?

better we just continue to  produce "our own  "    plain  fact sheets instead

sure we need to perpetrate an  occasional
  symbolic demolishment
u know  an atrocity of sorts
on  one or two of the leading figures
 among all these  plutonian singing insects and fact barbers

                                but no more then that


come to think of it

   our hero
mr peeevey reynolds here
    wouldn't be such a bad choice for a personal scrub down now would he

--a nice link to a review of his many  past efforts
  exposed in livid detailed colors
                 would be handy to have at one's unblushing  pink finger tips---

Thursday, July 12, 2012

tax rates anyone ?

Why are there "good jobs" and "bad jobs"?

Don't answer too quickly...


There are two "common sense" explanations which spring readily to mind, and which should therefore be dealt with first:
  1. Inequality of tasks
  2. Inequality of people
The first one is rooted in the individual experience of work. For any individual, there are some tasks that are pleasant and some that are unpleasant. Likewise, some jobs contain a high proportion of tasks that are unpleasant to most individuals: the so-called "dirty jobs" that "somebody has to do," such as garbage collection, work in slaughterhouses, janitorial work, etc. Jobs in this category also include those that are physically dangerous (police officer, soldier), morally unpleasant (prostitute, executioner), or require unpleasant sacrifices (working on an oil rig), etc.

But in a world where all else is equal, these unpleasant qualities should be "factored in" to the negotiation over terms of work and compensation. To some extent, this holds true in the world: some people voluntarily spend 4-6 months away from their families on an oil rig in exchange for higher pay, work as a cop for a while in anticipation of an early retirement, etc. But in many more cases, we see just the opposite prevail: "dirty" jobs with longer hours and worse pay than other jobs, which are often unnecessarily dangerous. Meatpacking, farm work, food processing, and warehouse work are examples of entire industries made up of primarily of "bad" jobs. The economy, it seems, tends to concentrate and aggravate, rather than disperse and alleviate, the odiousness of "dirty" jobs.

So the nature of the tasks is clearly not a sufficient explanation for why some jobs are bad...

marriage and the federal tax and transfer system

"Someone looking at our system from Mars would conclude that we don’t want moderate income families with children to marry, since we penalize them, but we do want older households (at ages when children are likely to be gone) to marry, since we subsidize them. "

a simple way to set up the basic wage subsidy

living wage - minimum wage

phase out    profile ?
ahh there's the rub

better work incentives are for everyone ....not !

forget about incentives to "invest"
contemporary advanced societies have  more then too much spontaneous
aggregate accumulation already hence the need for so much usury

but how about incentives to be more productive ?
can taxes reduce the supply of time and effort ?

read the link

couple money points:

"The nation’s real tax system includes not just the direct statutory rates explicit in such taxes as the income tax and the Social Security tax, but the implicit taxes that derive from phasing out of various benefits in both expenditure and tax programs "
"for the same amount of cost, a program that requires work will indeed lead to more work  than one that does not. "

"EITC and welfare reform have done better on the work front than did AFDC. "

need for reforms

" Combined effective marginal tax rates from dozens or hundreds of phase-outs can be very high and certainly lead to hidden and confusing government."

" The rates are especially high for low-to-moderate income households with children and include hundreds of billions of dollars of marriage penalties as well. "

"These high tax rates also extend into many middle-income programs as well. "

suggestions :

" (a) seeking broad-based social welfare reform rather than adopting programs one-by-one with multiple phase-outs,

(b) starting to emphasize opportunity and education over adequacy and consumption;

 (c) putting tax rates directly in the tax code to replace implicit tax rates,

 (d) making work an even stronger requirement for receipt of various benefits

 (e) adopting a maximum marginal tax rate for programs combined,

(f) letting child benefits go with the child and wage subsidies go with low-income workers rather than combining the two. "

a look at the total  tax and transfer  system's income profile

--get an f ing mag-glass ---


some utterly off the cuff remarks unrelated to the paper:

why might a diabolic system
have two plans

 tax cuts at the margin like your high flyers get in reaganomics
for the  lower orders of wagelings higher taxes

the jaw bone of an ass
              right across the back side

think of two forces inside one jobbler/producers head

 one force wants more market stuff
the other force wants more leisure

job hours offered are the outcome of this tussle of forces

now imagine the survival level is about your earning max potential

cut your take home wage and you either don't have enough
 or you work more hours...right ?
nothing will stop  you from trying to get enough hours to survive

ya its like being under water
no matter how much harder it may get to keep  going higher and higher
   you'll do it till you surface

these critters can really be wacked to hell...and have been

however imagine you are easily surviving
and suddenly you get a raise per hour

you might reduce your life time job hour plans eh ?
take a bit more leisure
that second force has cut in here

so again taxing your ass off will induce more offered hours

so when do we get to the point where lowering hourly rates might
reduce hours offered ?

  when you got so much task related income
 every increase gets off set at least in part
  by offering less hours

my guess this never happens to our "high market achievers"
but according to reaganomics it does
reagan himslef claimed he'd of taken more roles
in his hay days past
if back then his marginal tax rate hadn't been  so  damn high

how his eagerness to work more
could produce more roles to play in aggreaget instead of simply seeing the availible roles more hogger by the lucky/gifted few
  is left undiscovered i might add

but that's another thread
 but hey we hit another poser
what if we change not the average tax but the tax on additional job or task income

now rethink all this two force tussle bull shit
using marginal changes

its this that gets reaganized:

 additional hours  or higher rates per hour
                  are compensated at reduced  income  ?

again look at your underwaters first
they'll still take more hours  at least till their  heads are above water
in fact they 'll take as many hours as they can get
even at a reduced marginal pay rate

which btw is exactly what happens to lots of souls
    now  in the income related  social transfer payment system

now look at middlers the bulk of the production force

all are likely still looking for more income not more leisure

reaganites at the top ?

well you decide

joe stglitiz contends we oughta have progressive  average income taxes
and flatly regressive  marginal taxes on job/ task income
more or less pro rated by hours worked

make sense to you ?

i prefer a human capital tax
 a tax on wealth in market evaluated
 out put potential

Wednesday, July 11, 2012

the hi fi rocky road blues

ya okay so  wall street got  " outed "
after the crisis of fal '08

indeed the blood suckers are  taking huge amounts of  surplus vitality
  out of the production system (PS)

i say
                   more power to em
for pulling all that rent into one non functional sector

look the PS flew thru three bizz cycles with these fangs in their neck
just goes to prove how much non functional juice was in there

now we have a better notion of how much
Uncle's crack revenue units  aren't themselves sucking off the PS

why leave it for various suit apes like this critter ?

Tuesday, July 10, 2012

dean baker quote of the day

"Apparently many Democrats, who are unwilling to impose even a trivial tax increase on people earning more than $500,000 a year are willing to cut Social Security for people getting by on monthly checks that average less than $1,200 a month. "

Monday, July 9, 2012

a libertarian "bleeder "considers unions as equalizers

so what's the balance on unions pro and con?

this chap lays it all out in  10  points

i'll skip points 1 thru 6 ...they are the usual well meaning class poison

though i'll say he manages to present them in a most  annoying
 cream of wheat  fashion   that changes little and accimplishes less

at any rate
u can read it all here

now to points we might want to consider more deeply

this one i take personally
"7) Unions– their leadership, their membership, their supporters– are capable of significant bullying that easily spills into immoral coercion against outsiders, nonmembers, and dissenters; the charge of “scab” is often an accusation of punishable treason against a cause that the accused never signed up for."

the scab problem only exists because the strike is not considered
 a fully lawful act here in amerika inc
and besides that
 unions operate under  absurdly tilted rules of the game here too

if a strike is called and some employees want to go to work thru a picket line
i doubt that all by itself
creates huge coercion-ary hazards our softee here lamments

a bargaining unit (BU )
 may well rely on sympathetic action  by fellow workers not in the BU
 but to have formed a bargaining unit
               without adequate clout is plain and simply
              a strategic error from the get go
if the BU has insufficient leverage battling the  corporate when acting alone that BU has bigger challenges then to avoid bullying scabs
and that BU  needs to consider wider options

and besides that
 the very existence of a BU
 l submit "proves"  internal dissenters are not numerous enough
to pose a crucial threat to the union's  bargaining position

so itsnot fellow employees not even from inside the BU
  that pose a threat worthy of violence
   its  precisely scabs that bring out the bully boy in a BU on strike

remedy ?

the importation of outside replacements can and should be  unlawful ...end of point


now comes this guys "positives"in two points :

"8. Unions have been and continue to be absolutely indispensable for the mitigation of workplace power imbalances between managers and employees; they provide due process protections, protection against favoritism and nepotism and retaliation and harassment sexual and otherwise, protection against unjust dismissal and against the countless ways that managers can use the threat of dismissal to gain personal advantage. .... "

   well said ...but ....then there's this too :

".. there’s a sense in which many or most of these abuses are contrary to a firm’s interest. "

"a sense " ?
    what sense ...other then they are unlawful acts ?
i notice glibertarians like this line of talk..
and i think here's wh

watch him go  on from there  to total bogosity :

all these job site  oppressions by management against defenseless employees
"   amount to managers acting on their own behalf instead of on the firm’s,
 and so represent a type of corruption."
what ?
"   .. the manager demanding sexual services is seeking something that is only for his own benefit, not for the firm’s. "

oh ? and ....?

 " the same is true when someone is promoted or fired because of a personal relationship– favoritism or retaliation."
ya .....but notice the selection its a turn  toward what else....

" the principal-agent problems involved
                   in firms trying to manage their own managers "

in so when he suggests " It’s certainly possible to generate these protections
without unions; many professionals have them."
you expect him to suggest other means without the unions bad side
but no instead  he walks himself back aways:

".. for many non-professional employees, it has only ever been unions
that fought for these protections; it has only ever been unions
 that provided them; and they do not survive well when unions die out."

one might wish for at least a guess why that might be
maybe along the lines of welfare meets the profit motive ...
   one is left however thinking unions are there to prevent corruption
and bullying by straw bosses
---guys got a real thing about bullys but hey he's a libertarian
and the definition of a libertarian
   is a nerd  that got bullied in high school

now comes the big point ..the real point  the inter class bargain itself :

"9) Collective wage bargaining on the offer curve within the Edgeworth box between employees and employers is not only legitimate but (at least often) a positive good
..... there is bargaining room to maneuver in any given employment setting;
there are lower and higher wages that are both compatible with a given efficient level of firm output. ... if there are rents to be had or surpluses to be gained thanks to the strictly strategic aspects of bargaining– because “equilibrium wage” actually describes a range– then workers ought to have a reasonable chance of winning the negotiation and gaining that surplus..... if there are rents to be had or surpluses to be gained thanks to the strictly strategic aspects of bargaining– because “equilibrium wage” actually describes a range– then workers ought to have a reasonable chance of winning the negotiation and gaining that surplus."

great if he just ended it all there in fact i'll cheer him on

 "  that's the ticket  pal... throw the text book at em
  give those Galltish  bastards in the board room the old what for .."

and yet ever the prufrock...he dithers  away the impact of that fine passage :

"It might be difficult– might be impossible– to get institutions that would enable collective bargaining within that range and still check against bargaining that pushes outside the range and hurts competitiveness."

ya unions might go too far

lets hope so !

his wind up is as washy as it is wishy

"There’s nothing approaching a theory here. I look at some industries, some sectors, some places and say “there’s too much unionization there; the bad effects are getting crippling.” ....and I look at other industries, sectors, and places and say “there’s too little unionization here,”

"..I no longer have the basic hostility to them that many people (including many libertarians?) especially when workers evidently suffer from managerial workplace domination and abuse and lack procedural protections against them"

bully unions trump bully strawbosses

well you gotta take your class allies as they are ..right ?

i learned micro from this guy !!!

"Federal tax rate recommendations overall
& recognizing that Corp. dividends twice capital gains are taxed Twice
and that all of the sources of income are also taxed by states, etc.
 the same # of times:

Corp. Incomes: 15% for all size corporations.
Personal Income taxes on corp. Dividends and Capital gains: 15% each.
Personal Income tax maximum rate: 33 %
 optimize long term tax collections, growth & social welfare."

read this !!!!!!!!

the team of P and S have a nice paper on federal tax policy

everything u need to know about uncle sam's hand in the generation of increased inequality since jfk stole the election of 1960 is in there

Sunday, July 8, 2012

thesis: policy driven increases in inequality galvinize ideological polarization

here's a review
of this book

key question :

"Why has the ideological distance between the parties increased so dramatically since the 1970s?

method :

"the authors have applied a comprehensive statistical measure of relative positions on one (or two) dimensions, based on a complete set of roll call votes. Using roll call data, they compute an "ideal point" for each legislator along a scale of -1.0-1.0. This approach is a powerful one that permits calculation of a legislator's score from liberal to conservative. This permits comparison of the liberalness / conservativeness of legislators, including those whose careers did not overlap, and it allows an aggregate assessment of the relative positions of the parties over time. "


" The most important cause ...over time is degree of income stratification
   present at a point in time (national inequalities)......this is causal:
 politics has become more polarized as the stakes rise for those at the upper part of the distribution."

i'll repeat that last bit

its the take away

"more polarized as the stakes rise
                for those at
                   the upper part of the distribution."


commentary by reviewer:

" ( the authors)....succeed in cutting through the seemingly crazed rhetoric of conservative extremists in and out of Congress and reveal what it's really all about: protecting the economic interests of the wealthy.

the sizzling rhetoric coming from the right -- personal attacks on the President, anti-gay rants, renewed heat around abortion and contraception -- is just window dressing.

By the evidence of voting records, what the right really cares about is economic issues favoring the affluent -- tax cuts, reduced social spending, reduced regulation of business activity, and estate taxes.

  Maybe the best way of understanding the extremist pundits is as a class of well-paid entertainers, riffing on themes of hatred and cultural fundamentalism that have nothing to do with the real goals of their party."

Saturday, July 7, 2012

kush time on the lower mississippi

the  black belt lives !

sandy's man x rayed

From S.J. Chapman's Hours of Labour (Economic Journal, September, 1909, footnote 1, pp. 363-365) new graphs added by Tom Walker, May 1999.

 In order to avoid the complexities arising from the redistribution of labour
between the industries of a country, suppose that only one industry exists.

 Measure units of time in the working day along OX, and units of money along OY.

Consider first the unbroken lines which represent the influences governing employers.

 The curve P expresses the long-period variations with the length of the working day
 of the marginal value of a fixed quantity of labour:

 If On hours are worked, this daily value of labour and the wage will ultimately be Onda; if Ob hours are worked, this value and wage rises to Oba; if Oe hours are worked, it falls to Oba - bef.

The meaning of the curve P will now be plain. The curve is supposed to rise in the first instance because increasing the daily hours of labour would at first raise the level of efficiency, and if it did not, the larger wage would.

  But P must begin to fall at some point, and eventually cross OX,

. ...........................................

The curve ck represents the immediate variations of the marginal value of a fixed quantity of labour with the length of the working day on the assumption that the normal working day has been Ob. Hence the value of the normal product of the last minute of the working day Ob is bg. Ex hypothesi Obgc must equal Oba. If the working day is lengthened to Oe the product will at first be augmented by bekg, but finally by a gradual decline it will sink to Oba-bef.

The influences guiding the operatives are expressed in the dotted lines,

. Draw any vertical line dl to the left of b. Then dn is the addition made in the long run to the money income of the operative when the Onth increment of time is added to the working day. Let dm be the long-period value to the operative, when his income is Onda, of the leisure destroyed by the addition of the Onth increment of time to the working day. The curve I is the locus of the point m. Evidently, starting at a, it will lie throughout its length below P, increasingly departing from P (because leisure is subject to the law of diminishing utility and the value of leisure rises with income), and cut OX to the left of b.

Apart from the satisfaction or dissatisfaction of working, therefore, the far-sighted operative who took into account the value of leisure would choose a normal day Oi, which is less than Ob (the choice of far-sighted employers in combination). When the normal day is Oi the marginal value of leisure to an operative with a wage Oiha would be ih, which equals the long-period marginal earnings attributable to the Oith increment of time in the working day.

Now, let L indicate the long-period values to the operative of the effects of different lengths of working day on the absolute satisfaction or dissatisfaction involved in the labour itself, L being otherwise interpreted, when units of money are measured along OY' as well as along OY, and the parts of the curve below OX indicate the prices which would be paid to escape the dissatisfaction involved in working, and the parts above OX the money value of the satisfaction involved in working. As some of the time devoted to production will probably be pleasant to the operative when the length of the working day is most favourable to his enjoyment of work, we may assume that L need not lie throughout its length below OX. Then the working day which perfectly wise operatives would choose would be On, the point n being such that nm = nl, the attainment of which equation is the condition under which the operative's satisfaction is maximised. If, as is theoretically conceivable but practically impossible, L lay further above OX for the abscissa Ob than I lay below it, the length of day most advantageous to the operative would be greater than Ob.

If normal hours are On, the operative who lives for the day and is aware that more work, measured by results, means proportionately more pay, will obviously desire hours longer than On for the following reasons. The product attributable to the Onth increment of working time is greater than dn, since dn represents the gain resulting from the Onth. less the loss occasioned by the reduction which will ultimately take place in the productivity of the operative's earlier hours in consequence of the addition of the Onth increment of time to the working day. For similar reasons the short-period or immediate value of leisure might be less than dm. Again, the money measure of the disutility of the Onth increment of working time is less than nl, because nl measures the results from the fact that the Onth increment of working time diminishes capacity in earlier hours to enjoy labour or sustain fatigue.

It is evident, therefore, that a balance of gain accrues to the operative from the work of the Onth unit of time, when everything, including wages is taken into account, but the effect of the work on the Onth unit of time on the gain associated with the rest of the working day ignored; and, further, that the balance of gain attributable to the Onth hours will not disappear, though it may contract if the working day be slightly extended. Hence we must conclude that operatives who are not alive to the reactions of long hours on efficiency and capacity to enjoy life and work will tend to choose a longer working day than is wise from their point of view. However, to repeat, they will not approve such long hours as employers who are equally blind to future reactions, because the latter, if purely self-interested, make no allowance for the disutility of labour to the operative or the utility to him of leisure.

In the event of progress in methods of production the new position of P would be such that the area enclosed between it and the co-ordinate axes would be increased. P in its new position might cut OX at b, but in all probability the new intersection with OX would be to the left of b. It is not likely to fall to the right of b, since improvements in the mechanical aids of labour seldom mean that work is rendered less exhausting.

Even if the new curve P passed through b, the new position of I would practically mean its intersection with OX to the left of i because of the enhanced value of leisure. Further L, though it might rise higher than before, would probably descend sooner and at least as steeply. It is to be observed in addition that but for interest, rent and heavy depreciation charges, industrial progress would bring about movements of P involving more considerable augmentation of the area contained between P and the co-ordinate axes.

Improved education, apart from its effect on efficiency, would bring about a subsidence of the curve I, so that in its new position it would cut OX to the left of i. The effect wrought by progress on short-period forces need not be worked out in detail. The general conclusion is manifest that progress may be expected to be accompanied by a progressive curtailment of the working day.

absolute needs and relative needs

the list of both  need types
          changes with time and innovation
                              and alas both grow longer too ..  yes both
"new necessary needs"
is not a self-confounding expression

famously keynes had "absolute " needs in mind
                             when he wrote the following  :

"For at least another hundred years
  we must pretend to ourselves and to everyone
that fair is foul and foul is fair;
for foul is useful and fair is not.
    Avarice and usury and precaution
             must be our gods for a little longer still"

and we can  say in some sense
       as he predicted  in 1930
we first worlders from today's first class nations
  can" imagine"  a mass "sated "  class
                                                 quite easily in fact

ahh  if  only  all we needed  to feel
   we no longer  pursue  "happiness "
but  have  caught it
  well   if not happiness herself
    at least  a sufficient  material basis for happiness
she is cornered and we have an unencumbered  life time
                                 to wrestle her to the ground

but these keynes needs these absolute needs are only half the deal

   clearly " relative needs ...needs that arise thru "comparison "
of whats in your pile andwhats in mine is by construction
 a pursuit without end

the groaning board of status potlatch is ever with us

Rouseau needs lets call em
 the nasty  spurs  goading on
                      our tender amour propre

its not a paradox really
that  these  stinging relative needs
          become even more important as social  inequality rises

the taunts of the conspicuously superior
                                                      are ever thrown  in our faces
and we can't brush it off as absurd ..not all of it
there is always an inequality that finds and cuts the under belly
these past 30 years or so
 not only do we have the reality of growing inequality
   our mass culture   can't stop
                       showering  us  groundlings  with it

golden showers in fact
 and itsproduced all of it
          just  for you mr and mrs loser

the top dogs may swan about for each other

but the media by mounting it  and broadcasting it 24/7
                                                                      at all  us weebles 

                                   its   like  poodles peeing on fire hydrants