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snapper
19 Nov 13,, 18:11
In the home stretch of the 2012 presidential campaign, from August to September, the unemployment rate fell sharply — raising eyebrows from Wall Street to Washington.

The decline — from 8.1 percent in August to 7.8 percent in September — might not have been all it seemed. The numbers, according to a reliable source, were manipulated.

And the Census Bureau, which does the unemployment survey, knew it.

Just two years before the presidential election, the Census Bureau had caught an employee fabricating data that went into the unemployment report, which is one of the most closely watched measures of the economy.

And a knowledgeable source says the deception went beyond that one employee — that it escalated at the time President Obama was seeking reelection in 2012 and continues today.

“He’s not the only one,” said the source, who asked to remain anonymous for now but is willing to talk with the Labor Department and Congress if asked.

The Census employee caught faking the results is Julius Buckmon, according to confidential Census documents obtained by The Post. Buckmon told me in an interview this past weekend that he was told to make up information by higher-ups at Census.

Ironically, it was Labor’s demanding standards that left the door open to manipulation.

Labor requires Census to achieve a 90 percent success rate on its interviews — meaning it needed to reach 9 out of 10 households targeted and report back on their jobs status.

Census currently has six regions from which surveys are conducted. The New York and Philadelphia regions, I’m told, had been coming up short of the 90 percent.

Philadelphia filled the gap with fake interviews.

“It was a phone conversation — I forget the exact words — but it was, ‘Go ahead and fabricate it’ to make it what it was,” Buckmon told me.

Census, under contract from the Labor Department, conducts the household survey used to tabulate the unemployment rate.

Interviews with some 60,000 household go into each month’s jobless number, which currently stands at 7.3 percent. Since this is considered a scientific poll, each one of the households interviewed represents 5,000 homes in the US.

Buckmon, it turns out, was a very ambitious employee. He conducted three times as many household interviews as his peers, my source said.

By making up survey results — and, essentially, creating people out of thin air and giving them jobs — Buckmon’s actions could have lowered the jobless rate.

Buckmon said he filled out surveys for people he couldn’t reach by phone or who didn’t answer their doors.

But, Buckmon says, he was never told how to answer the questions about whether these nonexistent people were employed or not, looking for work, or have given up.

But people who know how the survey works say that simply by creating people and filling out surveys in their name would boost the number of folks reported as employed.

Census never publicly disclosed the falsification. Nor did it inform Labor that its data was tainted.

“Yes, absolutely they should have told us,” said a Labor spokesman. “It would be normal procedure to notify us if there is a problem with data collection.”

Census appears to have looked into only a handful of instances of falsification by Buckmon, although more than a dozen instances were reported, according to internal documents.

In one document from the probe, Program Coordinator Joal Crosby was ask in 2010, “Why was the suspected … possible data falsification on all (underscored) other survey work for which data falsification was suspected not investigated by the region?”

On one document seen by The Post, Crosby hand-wrote the answer: “Unable to determine why an investigation was not done for CPS,” or the Current Population Survey — the official name for the unemployment report.

With regard to the Consumer Expenditure survey, only four instances of falsification were looked into, while 14 were reported.

I’ve been suspicious of the Census Bureau for a long time.

During the 2010 Census report — an enormous and costly survey of the entire country that goes on for a full year — I suspected (and wrote in a number of columns) that Census was inexplicably hiring and firing temporary workers.

I suspected that this turnover of employees was being done purposely to boost the number of new jobs being report each month. (The Labor Department does not use the Census Bureau for its other monthly survey of new jobs — commonly referred to as the Establishment Survey.)

Last week I offered to give all the information I have, including names, dates and charges to Labor’s inspector general.

I’m waiting to hear back from Labor.

I hope the next stop will be Congress, since manipulation of data like this not only gives voters the wrong impression of the economy but also leads lawmakers, the Federal Reserve and companies to make uninformed decisions.

To cite just one instance, the Fed is targeting the curtailment of its so-called quantitative easing money-printing/bond-buying fiasco to the unemployment rate for which Census provided the false information.

So falsifying this would, in essence, have dire consequences for the country.

Census ‘faked’ 2012 election jobs report | New York Post (http://nypost.com/2013/11/18/census-faked-2012-election-jobs-report/)

Who'd have guessed?

astralis
19 Nov 13,, 20:29
you know, you're not doing your credibility any wonders when you source from the New York Post and from Zerohedge.

Bluesman
19 Nov 13,, 23:53
you know, you're not doing your credibility any wonders when you source from the New York Post and from Zerohedge.

NICE. That's all you got? I know you to be intellectually dishonest and blind to Reality as the rest of us experience it, but this is what you're down to: criticizing the source of documented and reported facts from an entity that your sniffy sense of superiority doesn't like, because you can't assail the facts themselves. The rest of us see exactly who you are when you do that.

And you speak of anybody else's cred? Dude, you made this once-excellent Board into a wasteland.

Doktor
20 Nov 13,, 00:00
I don't like the "kill the messenger" attitude, too, but what credibility Post has these days?

zraver
20 Nov 13,, 00:06
I don't like the "kill the messenger" attitude, too, but what credibility Post has these days?

As compared to say the NYT or any other NY based media outlet?

Doktor
20 Nov 13,, 00:08
As compared to say the NYT or any other NY based media outlet?

Well I had general US media scenery in mind. I know some time ago Post was declared less credible NY printed medium. Or something to that extent.

Bluesman
20 Nov 13,, 00:15
How 'bout we discuss the facts as reported, and not who told 'em to us?

And by the way, did you notice that attempt at mis-direction? The effort to drag the OP off-topic? I did.

astralis
20 Nov 13,, 00:29
blues,


NICE. That's all you got? I know you to be intellectually dishonest and blind to Reality as the rest of us experience it, but this is what you're down to: criticizing the source of documented and reported facts from an entity that your sniffy sense of superiority doesn't like, because you can't assail the facts themselves. The rest of us see exactly who you are when you do that.

so, let's discuss the facts "as reported".

an article that bases its accusation on one anonymous source; that cites ONE employee whom can't remember details of a conversation he had.

and oh, that employee left in 2011.

NY Post Source Julius Buckmon Left Census In 2011 - Business Insider (http://www.businessinsider.com/ny-post-election-jobs-numbers-bls-obama-census-julius-buckmon-2013-11)

ok. i certainly hope you did your job better than this clown of a NY Post reporter (but i repeat myself).

as for WAB being a wasteland, that begs the question why you continue to ghost this site and then occasionally pop in to drop self-righteous "i told you so's" and venomous one-liners. it's not needed, it's not appreciated, and if it continues i'll really regret having to make sure this is not repeated again.

DOR
20 Nov 13,, 02:18
How 'bout we discuss the facts as reported, and not who told 'em to us?

And by the way, did you notice that attempt at mis-direction? The effort to drag the OP off-topic? I did.

We have The New York Post (I'll leave it to others to discuss the quality of their journalism, as I don't believe I've ever read that particular paper) citing an anonymous source claiming to have evidence that some unknown number of surveys from the Philadelphia region were fabricated.

“The Census Bureau employee, for his part, said he never answered the part of the survey that asks if the respondent is ‘employed or not, looking for work, or have given up.’”

“It’s important to note that the Post’s anonymous source — not Buckmon — was supposedly involved in the September 2012 jobs report.”
If These Claims by ‘Reliable Sources’ Are Proven True, the Obama Administration Will Be Dealing With Another Huge Scandal | TheBlaze.com (http://www.theblaze.com/stories/2013/11/18/if-these-claims-by-reliable-sources-are-proven-true-the-obama-administration-will-be-dealing-with-another-huge-scandal/)

In other words, the fabricated surveys did not add to nor subtract from the underlying data. On this basis, we are supposed to believe beyond a shadow of a doubt that President Obama ordered this falsification.

Case not proven.

zraver
20 Nov 13,, 02:58
Case not proven.

There could be video of Obama throwing babies into the mouth of Moloch and you'd deny any wrong doing.

Obama is a disrespectful of the Constitution as Bush 43, as egotistical as Clinton, wedded to a vision of a new world order like (but a different order) Bush 41, sees himself as visionary as Reagan, is as inept as Carter, less forgiving than Ford and as corrupt as Nixon. One could only wish he had as much honor as LBJ, or that he felt like JFK that it was the peoples job to do for the country, not the country's job to do for the people.

TopHatter
20 Nov 13,, 03:15
Dude, you made this once-excellent Board into a wasteland.

Keith why are you doing this? :confused:

Bluesman
20 Nov 13,, 05:30
Keith why are you doing this? :confused:

Because I won't tolerate fools calling me foolish. I knew, and so did Jack Welch, that those numbers were bogus. And the blind faithful, like your esteemed Admin, were only too happy to carry water for a criminal gang that masquerades as a political party. They should be called on it. By this late date, NObody can claim innocence or ignorance of what they are supporting, and what they enable, and the consequences of all the ruination they abet.

Screw 'em if they don't like what I say or how I say it. One thing they cannot avoid is the fundamental truth that they're Bad Guys, and I don't care a dam' bit if they know I loathe them for it.

Julie
20 Nov 13,, 06:19
This Board is for the purpose of debate and discussion. The faked census report is all over the media today and i have read the same article on 7 different media outlets. Is there a "list" of "credible" sources we are mandated to use now when linking our sources? Are there certain topics that can not be discussed even though it is the hot news item of the day?

If there is one thing to say about Bluesman, he has always thoroughly sourced his data, and 9 times out of 10, he was also correct in his opinion as to the topic. So when the chickens come home to roost, I see nothing wrong with anyone making note that he was right in his prior debate of the subject.

I am a prime example of the eye-rolling when he was right, but hey, that's what changed me from a Democrat to a Republican. Bluesman always proved his point, and it almost always proved correct. Everyone here knows Blues expresses his opinions with much passion, and that always kept this Board lively, and I miss it.

So, if you want to keep trolls around for play toys, and deny this Board the liveliness and passion in the mere truth that Blues brings to this place, go ahead, because that just shows you are not intellectual enough for the challenge. In other words, that makes you the idiot in the room.

I also know I just violated a WAB rule. A rule that I had passed years ago. But, I am tired of seeing the partisan swing of this place and it bores me. Now, give me my suspension.

Doktor
20 Nov 13,, 10:36
This is getting rather interesting. As long as it's not getting personal I am all for the Bluesstorms ;)

Blues, do you believe that 4% (that's the difference from 7.8 to 8.1 if i calculated it correctly) error, falsification, or whatever you want to name it, seriously changed the outcome of the elections? Because, IMV, that's the bottom line.

And is there an ongoing investigation about this?

Minskaya
20 Nov 13,, 10:37
It seems that this actually started in October of 2012 when the conservative Jack Welsh (former CEO of General Electric) charged that the September unemployment numbers "defy logic".

Jack Welch: Unemployment rate cooked - Oct. 5, 2012 (http://money.cnn.com/2012/10/05/news/economy/welch-unemployment-rate/)

So far, all of the various media articles point to the New York Post root story. An investigation has been requested...



WASHINGTON — The Labor Department has contacted the Census Bureau about allegations in a New York Post article that the jobs data heading into the 2012 presidential election were manipulated. "We have contacted the Census Bureau about the allegations and we understand that the matter has been referred to the Commerce Department for an investigation," Stephen Barr, a senior managing director in the Labor Department's Office of Public Affairs, said Tuesday in an interview.
Labor Department says it contacted Commerce on jobs charges - chicagotribune.com (http://www.chicagotribune.com/news/sns-wp-blm-news-bc-jobs19-20131119,0,2975477.story)

Minskaya
20 Nov 13,, 10:45
Debate the story and its implications strenuously, but desist from engaging in further personal attacks

snapper
20 Nov 13,, 10:55
you know, you're not doing your credibility any wonders when you source from the New York Post and from Zerohedge.

Very good old chap! One sentence to attack me and the paper... really I applaud. I wasn't aware that you didn't like the New York Post. I apologise.

gf0012-aust
20 Nov 13,, 11:33
Seriously - have people not seen the prev warning?

snapper
20 Nov 13,, 13:57
Seriously - have people not seen the prev warning?

I unreservedly apologise and hope others will do so too.

There is a more serious and substantive matter here and that is the credibility of the US Administration. I am no 'Yank hater', quite the opposite. All the world and particularly 'the west' benefits from a strong prosperous and free US. The mismanaged Bush/Blair invasion of Iraq after non existent WMD was just the start of the dissemination of truth as practiced by this administration. From Bernanke's denial that were any bubbles in 2008 to Obama's dismal failure at 'stimulus' and now Janet "no bubbles here" Yellen the economy has gone to pot aided and abetted by rigged statistics. From an inflation/Consumer Price Index calculation that does not accept or count that 'consumers' eat food or buy fuel to a retrospective recalculation of GDP that amounts to a form of double accounting and now the question mark over jobs statistics where those who have given up looking for work are already no longer counted everything is done to delude the populace. The NSA which was supposedly busy looking for terrorists is actually busy monitoring innocent civilians in half the globe but Obama didn't know, the IRS targets those with a particular political point of view but nobody knew, Benghazi was a shock to the entire Administration when there were clear warnings, investigations into rigged metals markets - which anyone with half a brain can see - report "nothing to see here", people can held without trial ad infinitum... I mean the list goes on. Even when the Chinese call for the end of the $ as the world reserve people refuse to accept that maybe - just maybe - something is going very seriously wrong. Obama would not vote to raise the debt ceiling when Bush wanted it raised but when he wants it raised it's not increasing debt. He promises that the ACA won't force people to change doctors and plans and knowingly lied - at least these are things he knew about! It is about time that both the US Democrats and Republican stopped trying to score points from each other and recognised the real problems. Unless you stop deceiving yourselves you can never hope to address the real problems and the US will increasingly be viewed not as a beacon of liberty but of deception armed to the teeth with only selfish intent. For all our sakes stop lying to each other and to yourselves.

Doktor
20 Nov 13,, 14:06
¶ (http://en.wikipedia.org/wiki/Paragraph) :red:

DOR
21 Nov 13,, 03:23
Deleted as per warnings

JAD_333
21 Nov 13,, 05:25
Well, we have a problem with the NY Post article, not it's facts, but facts it did not report.

The "insider' source of their article is a man named Julius Buckmon. He was the surveyor for the Census Bureau who claimed to have submitted false employment numbers. The paper also cites 'confidential documents'.

The innuendo is clear: The favorable unemployment number released just before the 2012 election was faked.

But the NY Post fails to report that Buckmon left the Census Bureau in 2011, a year before the election. Also, it fails to report that the 'confidential documents' were from a 2010 government investigation, 2 years before the election.

It also ignores the sheer improbability that one surveyor or even 10 or 15 could skew the unemployment number. Buckmon was only one of 2,200 surveyors (http://www.bls.gov/cps/cps_htgm.htm#where), contacting a rotating pool of 60,000 households a month representing 110,000 individuals. The survey is broken down into about 2,000 geographic areas, from which about 800 are randomly selected to make up the unemployment rate. The only way the September 2012 unemployment number could have been rigged is by collusion among a large group of senior managers. One rogue surveyor couldn't have made a difference.

The problem of surveyors 'making-up' data isn't new. Often it's the result of plain laziness or in the rush to complete work. In fact, the Census Bureau always has a few cases under investigation, 14 in 2012.

So, how did the September 2012 unemployment rate miraculously drop from 8.1% to 7.8%? You get a sense of the reasons from this article out at the time: September unemployment rate falls to 7.8% (http://www.usatoday.com/story/money/business/2012/10/05/sept-jobs-report/1613541/)

Also, it is interesting that the 7.8% number was consistent with charts showing a gradual decline for the previous 2 years. The rate is currently 7.2%.

So, why is a Republican coming to the aid of Obama? I'm not, really. I just abhor ginned up tabloid scandals and crappy reporting. I don't have any complaint with the likes of Rep Issa using the furor to slam Obama and the dems, but personally I want to know the truth, and I want the WAB to be a place where the truth matters and journalistic bullsh*t exposed.

snapper
21 Nov 13,, 12:29
34403

DOR
22 Nov 13,, 02:44
34403

I think this is the graph you meant to post.

snapper
22 Nov 13,, 04:32
No my friend I did not. Just because unemployment statistics say the unemployment level is falling doesn't mean more people are working. They are not. Less people looking for work in this case means living by the black economy which is tax free!

DOR
22 Nov 13,, 05:29
You're right. Mine reflects unemployment (the topic), rather than the number of retired people.

Interesting aside: In October, US inflation fell below 1%, year-on-year, for the first time in four years. Interestingly, it is the same 48 month period that the real Fed Funds rate has been negative.

snapper
22 Nov 13,, 06:25
Sorry old chap but it ain't suddenly everyone retiring;

34411

Either that or a whole load of people suddenly retired in 2008 and no younger people want jobs. Stop either kidding yourself - which I pray is what you're doing - or worse deceiving others.

Inflation - CPI may fall if you don't count consumers as consuming food or fuel. By the 1980 calculation US inflation is around 9.5%. But statistics don't need to eat and as long as the numbers look good you can continue to rob the average man to feed the election donors. Keep a flat in Hong Kong is my advice - your 'forged bits of tree' won't save you soon from an angry mob.

dalem
22 Nov 13,, 09:15
Sheesh.

-dale

astralis
22 Nov 13,, 14:21
snapper,

actually it's pretty funny that you use that graph; Krugman uses the same to push for more stimulus.

a good portion of that number can be attributed to retired people. 2008 was the first year that the Boomers could start taking social security and retiring. of course this trend will accelerate as time goes on.

this is how you can have a declining unemployment rate AND continued stagnation in the employment-population ratio. the new normal will be lower than in previous years.

in any case, i'm curious as to how you trust THAT graph over others. after all, isn't the census faked? aren't employment numbers faked? aren't inflation numbers faked? could it be you trust that graph because it seemingly corresponds with one of your arguments? :)

Double Edge
22 Nov 13,, 17:05
actually it's pretty funny that you use that graph; Krugman uses the same to push for more stimulus.
This really is the question i was hoping to see an answer for here.

So people disagree whether the figures were faked. Now what. Continue QE or taper.

Is there a real recovery or not.

bfng3569
22 Nov 13,, 18:04
a good portion of that number can be attributed to retired people. 2008 was the first year that the Boomers could start taking social security and retiring. of course this trend will accelerate as time goes on.



i'd like to see something supporting that statement?

and bear in mind, many people that retired between 2008 and now, didn't have a choice in the matter.

astralis
22 Nov 13,, 19:14
bfng,


i'd like to see something supporting that statement?


i posted something about this a while back with snapper, but i can't find it now. a bit of google-fu later:

The U.S. labor force is still shrinking. Here’s why. (http://www.washingtonpost.com/blogs/wonkblog/wp/2013/11/08/the-u-s-labor-force-is-still-shrinking-rapidly-heres-why/)



Americans over the age of 65 are much less likely to work than prime-age Americans. And since that subset of Americans is expanding its ranks, that drives the labor-force participation rate down. Note that this shift is happening even though older Americans are staying on the job for longer than they did during the 1990s.

Economists disagree, however, on exactly how much demographics are responsible for the fall in the participation rate. The Chicago Fed estimates that retirements accounted for only one-fourth of the drop in labor force participation since the recession began. Other analysts, including Barclays, have suggested that aging Boomers could account for a majority of the fall.


either way, natural demographics DOES have an effect, and this effect will certainly accelerate over the next 10 years.


and bear in mind, many people that retired between 2008 and now, didn't have a choice in the matter.

of course, this is natural in a recession and its aftermath. not only will older folks just decide to give it up and retire, but if you're young and graduate into a recession, you will naturally have a harder time finding work, with implications that last through decades. employers don't like to see gaping holes in a resume, where the young person either cannot find employment or is forced to go into menial labor/unrelated work just to survive.

thus, given this and the demographics issue i noted, the new normal for a labor force participation rate will be lower today/in the future than it was in 2008. again, this is how unemployment numbers can go down while the labor force participation rate stagnates. (that's not saying all is well.)

to look at it from another angle, say shortly after inauguration in 2009, obama waves a wand (you can pick between Keynes and Ayn Rand, it doesn't matter for the sake of this example) and the recession ends. he waves the wand again and employment starts picking up, miraculously going back to 2007 job employment numbers within a month.

that labor force participation rate will still have declined, from approximately 65.5% to approximately 64.5-65.0%. and that's assuming god-like powers...

Stitch
22 Nov 13,, 22:24
This really is the question i was hoping to see an answer for here.

So people disagree whether the figures were faked. Now what. Continue QE or taper.

Is there a real recovery or not.

Corporate profits are through the roof, the stock market just broke 16,000, but wage earners still aren't seeing an increase in their earnings; most of the profit is going to the corporate bottom line and executive salaries.

There IS a recovery, but not for the lower/middle class in America.

Double Edge
22 Nov 13,, 23:14
Sounds like a QE taper is in the cards for Dec then.

JAD_333
23 Nov 13,, 05:53
Corporate profits are through the roof, the stock market just broke 16,000, but wage earners still aren't seeing an increase in their earnings; most of the profit is going to the corporate bottom line and executive salaries.

There IS a recovery, but not for the lower/middle class in America.

CEO pay, corporate profits, and a bullish stock market have less to do with the middle class malaise than high unemployment. In the tech sector, salaries are high because of strong demand for experienced programmers and engineers while in other sectors strong competition for scarce jobs keeps wages down.

Big corporations are banking their profits as a hedge against a possible relapse of the economy and a tightening of credit. Remember the credit crunch right after the housing bubble burst? But at some point, those corporations will have to begin investing in expansion or cede growth to the competition.

The high pay and generous stock options senior corporate officers get is in itself a contentious, even ethical subject, especially when so many people are out of work and barely getting by. However, it isn't a cause of middle class malaise.

The middle class is always the last to feel the effects of a recovery.

snapper
23 Nov 13,, 09:04
that labor force participation rate will still have declined, from approximately 65.5% to approximately 64.5-65.0%. and that's assuming god-like powers...

So if labour participation declines at 1% every 5 years shouldn't nobody be working?

astralis
23 Nov 13,, 17:00
it will simply fall and stabilize.

look at how the participation rate declined from 2002-2008. roughly 1% in 2-3 years (!!), in the 2002-2005 timeframe, despite a growing economy -and- a declining unemployment rate, before temporarily stabilizing from 2005-2008.

and that was -before- the retirement age for most boomers. i expect to see continued decline in the labor force participation rate on that basis alone, as the biggest cohort of boomers are slated to retire in the 2015-2020 timeframe.

astralis
23 Nov 13,, 17:05
JAD,


The high pay and generous stock options senior corporate officers get is in itself a contentious, even ethical subject, especially when so many people are out of work and barely getting by. However, it isn't a cause of middle class malaise.

that's mostly true, but not completely. one of the reasons why extreme income inequality is bad is because it depresses demand. those senior corporate officers are still limited by 24 hours a day, and one presumes they spend some of that time working, eating, and sleeping.

in other words if money that originally went to 10 people is instead concentrated in 1, that 1 person will be hard-pressed to spend the same amount of money. this is especially true of multimillionaires and billionaires; one can only buy so many yachts or bottles of champagne before the marginal utility calculation starts kicking in.

JAD_333
23 Nov 13,, 19:02
JAD,


that's mostly true, but not completely. one of the reasons why extreme income inequality is bad is because it depresses demand. those senior corporate officers are still limited by 24 hours a day, and one presumes they spend some of that time working, eating, and sleeping.

in other words if money that originally went to 10 people is instead concentrated in 1, that 1 person will be hard-pressed to spend the same amount of money. this is especially true of multimillionaires and billionaires; one can only buy so many yachts or bottles of champagne before the marginal utility calculation starts kicking in.

Seems to me your argument is along the line of folklore or populism. If corporate executive pay were lowered, the corporation would simply have more retained earnings. The corporation isn't going to cut pay of the CEO so it can add 10 employees unless there is a pressing need for more employees. On the flip side, corporations flush with cash could do both, keep executive pay where it is and still hire 10 more employees. So it isn't high executive pay that is having a negative impact on economic recovery. Besides, only a handful of corporations out of the 6,000 listed on the stock exchanges have above-average caches of cash, and, in fact, many of those have been upping dividends to shareholders which put more money out here for consumers.

zraver
23 Nov 13,, 19:12
JAD, the earnings of the average worker have been pretty much flat since the the 1970's, the lowest paid workers have declined and the richest have run away with the piggy bank. There is no proof trickle down works. The Rich and the politicians they control wont even allow the minimum wage to be tied to inflation.

snapper
23 Nov 13,, 21:30
it will simply fall and stabilize.

look at how the participation rate declined from 2002-2008. roughly 1% in 2-3 years (!!), in the 2002-2005 timeframe, despite a growing economy -and- a declining unemployment rate, before temporarily stabilizing from 2005-2008.

and that was -before- the retirement age for most boomers. i expect to see continued decline in the labor force participation rate on that basis alone, as the biggest cohort of boomers are slated to retire in the 2015-2020 timeframe.

Never rises? I thought US population was rising? Are they being born old? Shirley some mistake? Generation Y has the second highest birth rate in US history.

astralis
24 Nov 13,, 01:13
snapper,


Never rises? I thought US population was rising? Are they being born old? Shirley some mistake? Generation Y has the second highest birth rate in US history.

the participation rate largely isn't a function of population; demographics plays a bigger role. the US, like every other country in the world (especially developed), has an aging populace.

also, technology/globalization plays a key role. huge numbers of people are being replaced by robotics and computers, particularly the medium-skill labor-- low-skill labor got replaced a long time ago.

look at the labor rate graph from 1948:

34435

note that while this is happening, the US GDP and GDP/capita has increased hugely since the peak in the mid-90s. that means that despite less people working, the US is still producing more economic activity/goods than it did back then.

given the headwinds, i expect stabilization. depending on how future technologies work and the anticipated reversal of some of the old globalization trends (more companies are beginning to insource back to the US), there may be some growth, but certainly not that boom we saw in the 60s-70s-- that was largely a one-time expansion as women entered the workforce.

DOR
24 Nov 13,, 03:46
JAD, the earnings of the average worker have been pretty much flat since the the 1970's, the lowest paid workers have declined and the richest have run away with the piggy bank. There is no proof trickle down works. The Rich and the politicians they control wont even allow the minimum wage to be tied to inflation.

Apparently not.

Doktor
24 Nov 13,, 04:03
Are those adjusted for inflation?

zraver
24 Nov 13,, 04:08
Apparently not.

As usual you pick a chart that is so obviously off as to invite ridicule. In this case you ignore inflation- you know that thing that has caused the dollar to lose 83% of its value since 1970.

zraver
24 Nov 13,, 04:08
Are those adjusted for inflation?

No they are not and DOR knew that.

JAD_333
24 Nov 13,, 07:06
JAD, the earnings of the average worker have been pretty much flat since the the 1970's, the lowest paid workers have declined and the richest have run away with the piggy bank. There is no proof trickle down works. The Rich and the politicians they control wont even allow the minimum wage to be tied to inflation.

Gawd, no trickle down in what i said...

It's true; annual income for people below the top 20% of earners have not increased greatly since the 1970s. This chart bears that out.

34445

(The numbers in the chart are adjusted for inflation in 2007 dollars.)

And I've read that annual income for the lower 80% actually declined from 2010 to 2012.

Still, we see from the chart that incomes did rise, just not as steeply as for the top 20%. The disparity is stunning, but what's wrong with it? Is it simply obscene or unfair? Or is there something dangerous in it?

I've heard insinuations that the sharp increase in the top 20% group is somehow to blame for the lower growth in the incomes of the bottom 80%, but what evidence do we have of that?

The fact that the top 20% is doing better may actually be a positive. It may indicate that wealth is being accumulated by more people than ever before. Back in the early 1900s, very few people earned monster incomes. Now many do. If we can think about that without letting the fairness bug cloud our analytical powers, we might find some interesting answers.


Turning to the minimum wage, I'm not sure pegging it to inflation will do any good, since real hourly wages in most industries usually catch up to inflation and surpass it regardless of the minimum wage. Employers compete against each other for qualified workers. For that reason, the vast majority of jobs pay more than minimum wage. The minimum wage protects kids working part-time and prevents exploitation of vulnerable people. Otherwise, it's largely symbolic. If pegging it to inflation means more bureaucrats and more complicated paperwork, I say no.

Doktor
24 Nov 13,, 12:30
Still, we see from the chart that incomes did rise, just not as steeply as for the top 20%. The disparity is stunning, but what's wrong with it? Is it simply obscene or unfair? Or is there something dangerous in it?

I've heard insinuations that the sharp increase in the top 20% group is somehow to blame for the lower growth in the incomes of the bottom 80%, but what evidence do we have of that?
It is dangerous only if it is a trend. Certainly looks like it.


The fact that the top 20% is doing better may actually be a positive. It may indicate that wealth is being accumulated by more people than ever before. Back in the early 1900s, very few people earned monster incomes. Now many do. If we can think about that without letting the fairness bug cloud our analytical powers, we might find some interesting answers.
How can it be a good sign to have 'dead' money around and killing the middle class? There are limits on how much one can eat and drink. Those being all for progressive taxes have this argument. I have watched a documentary some time ago saying that progressive taxes trims the extra fat from the rich and puts it back in the economy. Is it working is another question.

snapper
24 Nov 13,, 12:41
the participation rate largely isn't a function of population; demographics plays a bigger role.

look at the labor rate graph from 1948:

34435



So if it's the demographics that are important why are you showing me graphs about employment? Just because employment rates have been falling since 2000 doesn't make it ok does it? Or are you suggesting that all this fiscal and monetary stimulus is actually a waste of time? My view is that it's not working for a specific reason - it's centrally organised malinvestment which is being payed for with tax and 'moar' debt. You have to start letting the poorest people save again.

Doktor
24 Nov 13,, 12:47
Is it employment graph or is it participation in labor force graph?

If it's the later what's confusion and why you relate it to the stimulus? It was never designed to somehow make US workers younger.

astralis
24 Nov 13,, 16:20
JAD,


If corporate executive pay were lowered, the corporation would simply have more retained earnings. The corporation isn't going to cut pay of the CEO so it can add 10 employees unless there is a pressing need for more employees. On the flip side, corporations flush with cash could do both, keep executive pay where it is and still hire 10 more employees.

quite true. i was addressing the larger point on inequality, though, to address this point:


The disparity is stunning, but what's wrong with it? Is it simply obscene or unfair? Or is there something dangerous in it?

the technological advances of the last 30 years, combined with globalization, give considerably greater weight to the age-old tension between capital and labor. your silicon valley start-up simply does not need as many employees as Ford or GM in the 50s, and the type of workers it does need are highly specialized.

this drives income inequality, and at an extreme level income inequality depresses demand simply due to time/value constraints. note i'm taking morality out of the equation. from a practical standpoint it's simply not economically efficient.

JAD_333
25 Nov 13,, 05:28
It is dangerous only if it is a trend. Certainly looks like it.

Why? A trend would imply the 20% is growing and may one day be 25, 30% or more. One economist agrees:


Economist Tyler Cowen (http://www.npr.org/2013/09/12/221425582/tired-of-inequality-one-economist-says-itll-only-get-worse) has some advice for what to do about America's income inequality: Get used to it. In his latest book, Average Is Over, Cowen lays out his prediction for where the U.S. economy is heading, like it or not:

"I think we'll see a thinning out of the middle class," he tells NPR's Steve Inskeep. "We'll see a lot of individuals rising up to much greater wealth. And we'll also see more individuals clustering in a kind of lower-middle class existence."

I happen not to agree with Cowen. I think income disparity is a temporary phenomenon brought about by the on-going transition from a manufacturing economy to a service/technical economy. I have no data to back that up.


How can it be a good sign to have 'dead' money around and killing the middle class? There are limits on how much one can eat and drink. Those being all for progressive taxes have this argument. I have watched a documentary some time ago saying that progressive taxes trims the extra fat from the rich and puts it back in the economy. Is it working is another question.


The logic is, a rich man can only eat three meals a day...better to take some of his money and give it to 1,000 people who will consume 3,000 meals a day. More consumption means more production, etc. Of course, that is absurd. Production will not increase because the 1,000 people are probably already eating.

Your question assumes that great wealth is dead money. But is that true? Ezra Klein (https://www.google.com/search?q=do+the+wealthy+spend+more&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a) writing in the Washington Post last year said, 'For years now, the exciting field of inequality studies has been puzzled by a seeming inconsistency in the data. Income inequality is clearly going up. But consumption inequality — that is to say, the difference between how much rich people and poor people spend — isn’t."

Many of the nuveau riche are internet entrepreneurs who have gotten rich from IPOs and buy-outs. Many of them plow their money back into new enterprises. Elon Musk, Jeff Brazos and the lesser beneficiaries of the Facebook and Twitter IPOs have gone on to create new start-ups. Some give their fortune over to philanthropy, like Warren Buffett and Bill Gates. Of course, there are some wealthy people who are content to sit on their riches.

The obvious cure for inequality is to increase taxes on the top 20%. We did it once; we could do it again. If the inequality truly begins to have harmful effects, we can be sure of one thing: Lower income people, who vastly outnumber the rich at the polls, can change it.

JAD_333
25 Nov 13,, 05:52
JAD,



quite true. i was addressing the larger point on inequality, though, to address this point:



the technological advances of the last 30 years, combined with globalization, give considerably greater weight to the age-old tension between capital and labor. your silicon valley start-up simply does not need as many employees as Ford or GM in the 50s, and the type of workers it does need are highly specialized.

this drives income inequality, and at an extreme level income inequality depresses demand simply due to time/value constraints. note i'm taking morality out of the equation. from a practical standpoint it's simply not economically efficient.

Asty:

We seem to agree on the causes of income eqaulity, but not on the effects. You said: "from a practical standpoint it's simply not economically efficient." I take that to mean there is a more efficient way. What is it, and what makes it more efficient?

This kind of thinking seems contradictory to me. We have in America a system that rewards innovation and accomplishment, and because of that, we have achieved a rather high standard of living in just over 200 years. The middle class, despite allusions to the contrary, are not wallowing in mud and picking through trash dumps for a living. Even what we term 'the lower-middle' and 'lower' class is not as bad off as people in many parts of the world. We can thank our innovators and captains of industry for this. But, if they had not had the incentive of amassing wealth to drive them on, where would we be today? People who talk of cutting the wealthy down to size to achieve greater income equality, are shortsighted, and may, if they get their way, do greater harm to the country than income equality. We have to be very careful how we approach the problem.

DOR
25 Nov 13,, 07:59
No they are not and DOR knew that.

Was there some part of REAL disposable personal income that escaped your attention?

astralis
25 Nov 13,, 15:03
JAD,


We seem to agree on the causes of income eqaulity, but not on the effects. You said: "from a practical standpoint it's simply not economically efficient." I take that to mean there is a more efficient way. What is it, and what makes it more efficient?

it's not the role of the market to reduce income inequality, which in the long-term is bad for the free-market system. it's the role of politics/government to do so.

as with most things, it's a balance. what can reduce the extremes enough so that more money gets shifted into the middle-class, while keeping the incentives for entrepreneurship? a general answer would be relatively high tax rates on the wealthy, to be balanced out by low corporate taxes; with high investment in education, science, and technology.



This kind of thinking seems contradictory to me. We have in America a system that rewards innovation and accomplishment, and because of that, we have achieved a rather high standard of living in just over 200 years. The middle class, despite allusions to the contrary, are not wallowing in mud and picking through trash dumps for a living. Even what we term 'the lower-middle' and 'lower' class is not as bad off as people in many parts of the world. We can thank our innovators and captains of industry for this. But, if they had not had the incentive of amassing wealth to drive them on, where would we be today?

most of those talk about inequality in moralistic terms. it's more useful to look at it from practical terms. what is the most effective way of shearing sheep without cutting into the meat.

note that there were still captains of industry and innovators in the 1940s-60s america, where the tax rate on the wealthy were deliberately punitive. i certainly don't advocate a return to such levels, but it's important to see how the wealthy can recoup losses fairly easily, which is something people who make money through labor often do not understand. money is made differently among the wealthy. again, not a moral judgment but a practical one.


People who talk of cutting the wealthy down to size to achieve greater income equality, are shortsighted, and may, if they get their way, do greater harm to the country than income equality. We have to be very careful how we approach the problem.

i agree. i think i've banged on my late-90s era Third Way drum here in the past...:)

bonehead
25 Nov 13,, 16:24
I happen not to agree with Cowen. I think income disparity is a temporary phenomenon brought about by the on-going transition from a manufacturing economy to a service/technical economy. I have no data to back that up.


I agree to the reason but I am not so sure on this being "temporary".




The logic is, a rich man can only eat three meals a day...better to take some of his money and give it to 1,000 people who will consume 3,000 meals a day. More consumption means more production, etc. Of course, that is absurd. Production will not increase because the 1,000 people are probably already eating.



We are talking much more than food. GM's business model was built on selling X units per year. They sold the bulk of their vehicles to those not at the top. How big would GM be if they only catered to the rich and how many spin off GM jobs would we have? The bottom line is that the economy NEEDs a middle class with disposable income. However since the 70's that disposable income by the middle class has been chipped away more and more and there have been more than a few effects from this.


Your question assumes that great wealth is dead money. But is that true? Ezra Klein (https://www.google.com/search?q=do+the+wealthy+spend+more&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a) writing in the Washington Post last year said, 'For years now, the exciting field of inequality studies has been puzzled by a seeming inconsistency in the data. Income inequality is clearly going up. But consumption inequality — that is to say, the difference between how much rich people and poor people spend — isn’t."

Many of the nuveau riche are internet entrepreneurs who have gotten rich from IPOs and buy-outs. Many of them plow their money back into new enterprises. Elon Musk, Jeff Brazos and the lesser beneficiaries of the Facebook and Twitter IPOs have gone on to create new start-ups. Some give their fortune over to philanthropy, like Warren Buffett and Bill Gates. Of course, there are some wealthy people who are content to sit on their riches.



The question is who benefits from the money those at the top spend.



The obvious cure for inequality is to increase taxes on the top 20%. We did it once; we could do it again. If the inequality truly begins to have harmful effects, we can be sure of one thing: Lower income people, who vastly outnumber the rich at the polls, can change it.


I say the better solution is to give the middle class their jobs/wages back. More taxes only goes to the government.

astralis
25 Nov 13,, 16:44
bonehead,


I say the better solution is to give the middle class their jobs/wages back. More taxes only goes to the government.

not sure how you can "give the middle class their jobs/wages back" without some sort of government role.

technology and globalization play huge countervailing pressure-- you don't need as many workers to do the job, and now instead of competing within a limited national pool of workers, corporations can now access a far larger international pool.

Wooglin
25 Nov 13,, 18:58
Why? A trend would imply the 20% is growing and may one day be 25, 30% or more. One economist agrees:



I happen not to agree with Cowen. I think income disparity is a temporary phenomenon brought about by the on-going transition from a manufacturing economy to a service/technical economy. I have no data to back that up.




The logic is, a rich man can only eat three meals a day...better to take some of his money and give it to 1,000 people who will consume 3,000 meals a day. More consumption means more production, etc. Of course, that is absurd. Production will not increase because the 1,000 people are probably already eating.

Your question assumes that great wealth is dead money. But is that true? Ezra Klein (https://www.google.com/search?q=do+the+wealthy+spend+more&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a) writing in the Washington Post last year said, 'For years now, the exciting field of inequality studies has been puzzled by a seeming inconsistency in the data. Income inequality is clearly going up. But consumption inequality — that is to say, the difference between how much rich people and poor people spend — isn’t."

Many of the nuveau riche are internet entrepreneurs who have gotten rich from IPOs and buy-outs. Many of them plow their money back into new enterprises. Elon Musk, Jeff Brazos and the lesser beneficiaries of the Facebook and Twitter IPOs have gone on to create new start-ups. Some give their fortune over to philanthropy, like Warren Buffett and Bill Gates. Of course, there are some wealthy people who are content to sit on their riches.

The obvious cure for inequality is to increase taxes on the top 20%. We did it once; we could do it again. If the inequality truly begins to have harmful effects, we can be sure of one thing: Lower income people, who vastly outnumber the rich at the polls, can change it.

You've got to be kidding me. You're lumping Bill Gates and Warren Buffet in with a family making 75k living in the NY Metropolitan area. Try telling that family they're making too much and need a 20% tax increase. Try explaining the inequality argument to them and see how that goes. A household income of 75k/year in this neck of the woods isn't going very far at all. They're not likely even homeowners, and they're not sure how they're going to pay for their kids' college or how to cover that 100% medical insurance premium raise they just got hit with, because they sure don't qualify for subsidies. You can double their income to 150k (top 5%) and in this area they're getting by, but not much more than that.

These charts and blanket arguments never take cost of living into account. 150k in NY is not the same as 150k in South Bumblefuck, LA.

JAD_333
25 Nov 13,, 19:24
JAD,



it's not the role of the market to reduce income inequality, which in the long-term is bad for the free-market system. it's the role of politics/government to do so.

What the market giveth, it can take away. :)


as with most things, it's a balance. what can reduce the extremes enough so that more money gets shifted into the middle-class, while keeping the incentives for entrepreneurship? a general answer would be relatively high tax rates on the wealthy, to be balanced out by low corporate taxes; with high investment in education, science, and technology.

Whaat? Are you proposing confiscatory taxation? Say you are, then how do you shift the money from the government to the middle class?




most of those talk about inequality in moralistic terms. it's more useful to look at it from practical terms. what is the most effective way of shearing sheep without cutting into the meat.

Ok, look at it from practical terms. What's practical about the personal motivation of an entrepreneur? How is someone driven to succeed without incentives. Sure, you achieve a practical end, but it comes from an irrational desire for gain--that is, and emotional drive to succeed.



note that there were still captains of industry and innovators in the 1940s-60s america, where the tax rate on the wealthy were deliberately punitive.

And tax shelters abounded. How soon everyone forgets. :)



i certainly don't advocate a return to such levels, but it's important to see how the wealthy can recoup losses fairly easily, which is something people who make money through labor often do not understand. money is made differently among the wealthy. again, not a moral judgment but a practical one.

And by what mechanism do you referee these differences? And if you could, what would do the ones who draw the short straws.





i agree. i think i've banged on my late-90s era Third Way drum here in the past...:)

Indeed. :)

astralis
25 Nov 13,, 19:48
wooglin,


You've got to be kidding me. You're lumping Bill Gates and Warren Buffet in with a family making 75k living in the NY Metropolitan area. Try telling that family they're making too much and need a 20% tax increase. Try explaining the inequality argument to them and see how that goes. A household income of 75k/year in this neck of the woods isn't going very far at all. They're not likely even homeowners, and they're not sure how they're going to pay for their kids' college or how to cover that 100% medical insurance premium raise they just got hit with, because they sure don't qualify for subsidies. You can double their income to 150k (top 5%) and in this area they're getting by, but not much more than that.

These charts and blanket arguments never take cost of living into account. 150k in NY is not the same as 150k in South Bumblefuck, LA.

this is a valid point, to a degree.

i say to a degree because this argument can always be extended.

150K in Upper West Side or in Belair or Newport Beach is not the same as 150K in NY, for instance.

the biggest dividing line, i think, is between those who need to work and collect a salary and those who only need invest and collect a dividend. that division actually fits right into the example you bring up, Bill Gates/Warren Buffet and that family making 75K.

as i alluded to with my discussion with JAD, once you hit a certain amount of $$, the exponential effect of investing, aka the magic of the market, works significantly in your favor. it takes but five minutes, if that, to set up a portfolio with minimum risk that will garner 3.5-4% year on year at minimal cost.

try getting that type of annual salary increase!

JAD_333
25 Nov 13,, 20:02
You've got to be kidding me. You're lumping Bill Gates and Warren Buffet in with a family making 75k living in the NY Metropolitan area. Try telling that family they're making too much and need a 20% tax increase. Try explaining the inequality argument to them and see how that goes. A household income of 75k/year in this neck of the woods isn't going very far at all. They're not likely even homeowners, and they're not sure how they're going to pay for their kids' college or how to cover that 100% medical insurance premium raise they just got hit with, because they sure don't qualify for subsidies. You can double their income to 150k (top 5%) and in this area they're getting by, but not much more than that.

These charts and blanket arguments never take cost of living into account. 150k in NY is not the same as 150k in South Bumblefuck, LA.

No, wooglin, I am not kidding you. :)

You ask, how can I lump Buffett and Gates into a group that includes people making only $75k. First, they both fit into top 20% of income earners. That would include the top 1%, etc. Second, the chart set the categories, not me. Third, by roping off the top 20%, which as group experienced an income growth rate of 95% and higher between 1979-2007, I could show the low-growth range was the remaining 80%. I was not saying that the lower end of the 20% was well-off or not struggling, just that their incomes did run ahead of inflation by a pretty good clip. So your NY friends have no bone to pick with me. I feel for them because I was in the top 5% and stuggling. Asty wants to tax me more. :eek:

JAD_333
25 Nov 13,, 20:18
I say the better solution is to give the middle class their jobs/wages back. More taxes only goes to the government.

Agree. I think it will happen, but not by government fiat. It will happen when 1) industry dislocations and automation peak out and 2) when the number of people looking for jobs shrinks significantly. Then employers will have have a harder time than today finding qualified people to fill vacancies and to beef up their work force. They will have to compete with their competitors for a small number of available workers and that will drive up incomes. Lower the corporate tax rate could help too, since corporations might then be more willing to repatriate money held in foreign accounts and put it to work in expanding operations.

Wooglin
25 Nov 13,, 20:59
No, wooglin, I am not kidding you. :)

You ask, how can I lump Buffett and Gates into a group that includes people making only $75k. First, they both fit into top 20% of income earners. That would include the top 1%, etc. Second, the chart set the categories, not me. Third, by roping off the top 20%, which as group experienced an income growth rate of 95% and higher between 1979-2007, I could show the low-growth range was the remaining 80%. I was not saying that the lower end of the 20% was well-off or not struggling, just that their incomes did run ahead of inflation by a pretty good clip. So your NY friends have no bone to pick with me. I feel for them because I was in the top 5% and stuggling. Asty wants to tax me more. :eek:

Yeah, I'm aware you didn't create the chart... did I suggest otherwise somewhere? I didn't attack the chart, rather the blanket idea that families with an income of 75k need to be taxed more regardless of any fact other than they fall within the top 20% where incomes grew the most. It's not that simple, or at least it certainly shouldn't be. It would only drag millions down while the very wealthy are still going to be very wealthy, and the poor are still going to be poor, and the extra billions collected in taxes thrown away on wasteful spending.

JAD_333
25 Nov 13,, 21:09
No you didn't, but you didn't approve of my interpretation. Anyway, that doesn't matter.

I also did not say anyone should be taxed more. You got me mixed up with someone else. In fact, I would argue the opposite given the current state of affairs. Those could change.

I agree on your final point re wasteful spending.

astralis
25 Nov 13,, 21:29
JAD,


I feel for them because I was in the top 5% and stuggling. Asty wants to tax me more

nah. unless you were making all yer money off of dividends. :)

plus, if you ask my better half, she sez we're struggling even tho we're in the top 10% and we've no children...

Wooglin
25 Nov 13,, 21:45
No you didn't, but you didn't approve of my interpretation. Anyway, that doesn't matter.

I also did not say anyone should be taxed more. You got me mixed up with someone else. In fact, I would argue the opposite given the current state of affairs. Those could change.

I agree on your final point re wasteful spending.

I didn't get it mixed up with anyone else...


The obvious cure for inequality is to increase taxes on the top 20%. We did it once; we could do it again. If the inequality truly begins to have harmful effects, we can be sure of one thing: Lower income people, who vastly outnumber the rich at the polls, can change it.

Wooglin
25 Nov 13,, 21:50
JAD,



nah. unless you were making all yer money off of dividends. :)

plus, if you ask my better half, she sez we're struggling even tho we're in the top 10% and we've no children...

I understand your better half, and that's what got my attention in this thread. We fall into the top 5% of that chart and have no kids and we are not what anyone would consider wealthy by any stretch. It's just damn expensive to live around here and I often wonder how many people, particularly with kids, manage it. I'd love to move, but then there's the salary difference... anyway, cost of living differences matter.

JAD_333
25 Nov 13,, 21:59
I didn't get it mixed up with anyone else...


Quote Originally Posted by JAD_333
The obvious cure for inequality is to increase taxes on the top 20%. We did it once; we could do it again. If the inequality truly begins to have harmful effects, we can be sure of one thing: Lower income people, who vastly outnumber the rich at the polls, can change it.


Ah, yes. But you'll notice I said 'could' tax. I didn't say I was in favor of doing it, at least not as things stand today. A year or two from now, who knows? Never say never. Remember Bush Sr...'Read my lips. NO NEW TAXES". And he went right ahead a did support new taxes to save Social Security, which was the right thing to do. It took guts, knowing he could lose re-election, and lose he did. I'm nor running for anything so I say 'no new taxes' unless the wheels start coming off...

JAD_333
25 Nov 13,, 22:03
I understand your better half, and that's what got my attention in this thread. We fall into the top 5% of that chart and have no kids and we are not what anyone would consider wealthy by any stretch. It's just damn expensive to live around here and I often wonder how many people, particularly with kids, manage it. I'd love to move, but then there's the salary difference... anyway, cost of living differences matter.

A lot depends on life style. 'Struggling' with 2 houses, 3 cars and an expensive taste in wine is somewhat laughable. Struggling with far less gets my sympathy. Yeah, I am thinking of a move down south where the COL is lower and I can indulge in a few non-essentials. What city do you live in? NY?

Wooglin
25 Nov 13,, 23:23
A lot depends on life style. 'Struggling' with 2 houses, 3 cars and an expensive taste in wine is somewhat laughable. Struggling with far less gets my sympathy. Yeah, I am thinking of a move down south where the COL is lower and I can indulge in a few non-essentials. What city do you live in? NY?

I work in NYC, but I live in central NJ. About a 90 minute total commute each way. To live closer to NYC you either have to pay much more, or accept much less for the same money.

DOR
26 Nov 13,, 04:22
I work in NYC, but I live in central NJ. About a 90 minute total commute each way. To live closer to NYC you either have to pay much more, or accept much less for the same money.

That's true everywhere. Here in HK it can be 10x extra rent to cut 45 minutes off of the one-way commute.

snapper
26 Nov 13,, 07:18
Is it employment graph or is it participation in labor force graph?

If it's the later what's confusion and why you relate it to the stimulus? It was never designed to somehow make US workers younger.

I am talking about Astralis idea that somehow - despite a rising population the ratio of people working compared to the population fell suddenly between 2008-10;

34454

Astralis would have us believe that suddenly - quite independent of any banking collapse or Obama stimulus - all the 'baby boom' generation suddenly retired then and yet none of the growing population has since really got into work. Something doesn't add up with astralis' idea that the employment rate always falls. I mean it must have risen at one point right? Why was that different to now? It also shows pretty clearly that the US employment data not entirely showing the true picture. Just because you don't count people who aren't actively seeking work doesn't mean they're employed - clearly they are not as this and the food stamp recipient numbers suggest. They've given up and are living on benefits or via the black market - or both. It amounts to a deception.

JAD_333
26 Nov 13,, 08:35
That's true everywhere. Here in HK it can be 10x extra rent to cut 45 minutes off of the one-way commute.

Commute from where? You're already there. :) Just making fun. I was there and remember the horrible traffic.

JAD_333
26 Nov 13,, 08:43
I work in NYC, but I live in central NJ. About a 90 minute total commute each way. To live closer to NYC you either have to pay much more, or accept much less for the same money.

Tell me about it. My son just moved his family out of NYC across the river in NY. Twice the size condo and good preschool for half the price.

astralis
26 Nov 13,, 14:57
snapper,


Astralis would have us believe that suddenly - quite independent of any banking collapse or Obama stimulus - all the 'baby boom' generation suddenly retired then and yet none of the growing population has since really got into work. Something doesn't add up with astralis' idea that the employment rate always falls. I mean it must have risen at one point right? Why was that different to now? It also shows pretty clearly that the US employment data not entirely showing the true picture. Just because you don't count people who aren't actively seeking work doesn't mean they're employed - clearly they are not as this and the food stamp recipient numbers suggest. They've given up and are living on benefits or via the black market - or both. It amounts to a deception.

did you not read my post addressing this?

http://www.worldaffairsboard.com/american-politics-economy/64679-faked-census-show-higher-employer-data-pre-election-2012-a-3.html#post939757

i addressed your point about the rising population; simply put, the size of the boomer population is such that their retirements en masse lowers the overall participation rate, despite Gen Y joining (in reduced numbers, due to both pure size as well as a weak economy).

i also mentioned technology and globalization as drivers in reduction of the rate. i also put up a graph showing the rate since the 40s, and pointed out that women joining the workforce accounts for the one-time big expansion throughout the 60s-70s.

finally, i also did NOT say that "employment rate always falls".

despite all this, you ignored everything i wrote on the subject, and repeated your opening argument. why?

snapper
26 Nov 13,, 15:40
Well let me explain why clearly - all your "boomer population" suddenly retired between 2008 and 2010. This according to you is the reason why no stimulus has actually worked. Because it's 'natural'.

Look suppose we switch the coin and talk about employment rates as opposed to unemployment rates. There are still nigh on 5 million less people working the US now than in 2008. All are "boomer population"? How convenient. :confu:

One could go on to ask about the reality of the 'recovery' given that less people are working.

astralis
26 Nov 13,, 16:00
snapper,


all your "boomer population" suddenly retired between 2008 and 2010. This according to you is the reason why no stimulus has actually worked. Because it's 'natural'.


i'll thank you to stop putting words in my mouth.

note that i DID NOT say that "all the boomer population suddenly retired between 2008 and 2010".

note that i DID NOT say that "this is the reason why no stimulus has actually worked".

note that i DID NOT say that "5 million less people working in the US now than in 2008" and that i DID NOT say that this is all from the boomers.

i'm more than happy to debate with you. you seem much more interested in debating strawmen that you assert are my positions.

READ MY POST, and address it point by point. i mentioned FIVE FACTORS in the lowering of the participation rate and you focus on ONE.

bfng3569
26 Nov 13,, 18:46
bfng,



i posted something about this a while back with snapper, but i can't find it now. a bit of google-fu later:

The U.S. labor force is still shrinking. Here’s why. (http://www.washingtonpost.com/blogs/wonkblog/wp/2013/11/08/the-u-s-labor-force-is-still-shrinking-rapidly-heres-why/)



either way, natural demographics DOES have an effect, and this effect will certainly accelerate over the next 10 years.



of course, this is natural in a recession and its aftermath. not only will older folks just decide to give it up and retire, but if you're young and graduate into a recession, you will naturally have a harder time finding work, with implications that last through decades. employers don't like to see gaping holes in a resume, where the young person either cannot find employment or is forced to go into menial labor/unrelated work just to survive.

thus, given this and the demographics issue i noted, the new normal for a labor force participation rate will be lower today/in the future than it was in 2008. again, this is how unemployment numbers can go down while the labor force participation rate stagnates. (that's not saying all is well.)

to look at it from another angle, say shortly after inauguration in 2009, obama waves a wand (you can pick between Keynes and Ayn Rand, it doesn't matter for the sake of this example) and the recession ends. he waves the wand again and employment starts picking up, miraculously going back to 2007 job employment numbers within a month.

that labor force participation rate will still have declined, from approximately 65.5% to approximately 64.5-65.0%. and that's assuming god-like powers...

I think you either missed my point or doesn't seem you took it into account, which is the issue I have with some of these charts.

this 'natural recession and its aftermath' you mention, was not at all natural.

I posted, and I really don't know what your response above has to do with it, a lot of older people that did retire around the time frame in question and after did not have a choice.

it was that or unemployment.

and that is what I do not see accounted for in any of these fancy charta comparing labor participations rates and unemployment and retires....

astralis
26 Nov 13,, 19:07
bfng,


this 'natural recession and its aftermath' you mention, was not at all natural.



i did not say "natural recession".

note what i wrote.


of course, this is natural in a recession and its aftermath. not only will older folks just decide to give it up and retire, but if you're young and graduate into a recession, you will naturally have a harder time finding work, with implications that last through decades.

as in, over the course of a recession, relatively old people may decide to retire early, either voluntarily or not. this happens in every recession.

this is a different idea than a "natural recession".


it was that or unemployment.

and that is what I do not see accounted for in any of these fancy charta comparing labor participations rates and unemployment and retires....

it's accounted for; that's why labor participation rate declined.

if your issue is the fact that volutary retirements and involuntary retirements are conflated in the labor participation rate, that is true.

however, one cannot simply assume that everyone whom retired between 2008 and now did it because they had no choice. moreover, what i was getting at in my response is that demographics plays a huge role in the labor participation rate, and that regardless of this debate about voluntary/involutary retirements, you'll see a decline anyway over the next few years. just because there is no recession doesn't mean people will stop aging and retiring.

in fact, to balance out the people involuntarily retiring, there are people whom will delay retirement as they attempt to rebuild their savings/401ks.

DOR
27 Nov 13,, 02:33
snapper,

You want to talk about employment, instead of unemployment? Fine.

* Civilian employment has been rising, year on year, for the past 12 quarters.

* The maximum civilian employment in US history was in the fourth quarter of 2007, at 146.26 million. 2013 Q-3’s 144.25 mn was 2.01 million below that, not 5 million.

* The maximum private sector employment in US history was in the fourth quarter of 2007, at 115.67 million. 2013 Q-3’s 114.34 mn was 1.34 million below that, not 5 million.

* The maximum number of manufacturing jobs was in June 1979 (19.55 mn); and the maximum number of service sector jobs was in . . . October 2013 (117.85 mn).


= = = = =

I’m amazed to see people can still think of 2007+ as a “recession.”

We had a depression.

If you think of it as if it was a recession, you'll advocate the wrong policy responses and expect the wrong outcomes. Once you realize that it wasn't a recession, and begin to think about what a depression is and how it has been dealt with in the past, then an entirely new set of policy instruments are needed, and an entirely new timeframe for recovery is to be expected.

Think of Japan, 1990s and not the US, 1990s.

snapper
28 Nov 13,, 01:35
note that i DID NOT say that "all the boomer population suddenly retired between 2008 and 2010".

Indeed but you did say that even had there been no recession employment would be lower due to boomer retirement. According to you the stimulus should have raised the employment levels - it clearly hasn't and that's why US employment statistics are deceptive at best. All they really say is that you more people getting into more debt or living on benefits and living from the black market since despite a growing population employment to population ratios have not risen since 2008-10. Stimulus - both fiscal and monetary - fail.

Happy Thanksgiving stuff :)

astralis
28 Nov 13,, 01:54
snapper,


Indeed but you did say that even had there been no recession employment would be lower due to boomer retirement. According to you the stimulus should have raised the employment levels -

i fail to see why this concept is so hard to understand. the labor participation rate would have been lower partly due to boomer retirement, to the factors i listed above, and to the great recession. on the other hand, stimulus HAS increased employment, but not enough to erase all the effects of the recession, let alone all the other factors i've discussed.

the stimulus was some $787 billion. all the QEs added up equals some $3.7 trillion (not the same effect as direct fiscal stimulus). the great recession involved trillions of dollars getting wiped out. note that US household net worth fell $15 trillion between 2007-2009.

so yes, both of these things can be true at the same time. neither stimulus nor QE was meant to be a cure-all. at best, one could say "it could have been worse". and it would have been, looking back at it. even the IMF, which pooh-poohed stimulus at first, eventually came to admit that assessment as a mistake.

anyway, a happy thanksgiving to you too. hope you participate in black friday and contribute to a bit of, ah, stimulus in your own country. :)

snapper
28 Nov 13,, 02:50
I see... despite any evidence that stimulus has worked the situation 'would have been worse' without it. Perhaps more stimulus is needed? More debt or higher tax and spend? More devaluation? More impoverishment of normal people? Because if it didn't work first time it must mean 'moar' is needed right?