Sunday, September 05, 2004
This is a sticky post written the day we first appeared on the internet: Welcome to article43.com - a memorial to the layed off workers of (PRE SBC MERGER) AT&T, and the disappearing MIDDLE CLASS citizens of America. It is NOT endorsed or affiliated with AT&T or the CWA in any way.
In addition to INFORMATION, resources and opinion for former AT&T workers DEALING WITH the EFFECTS OF LAYOFF and looking for meaningful employment, some articles here are meant to bring into awareness the LARGER PICTURE of corporate dominance of the UNITED STATES’ political and economic policies which brazenly DISREGARDS, disrespects and EXPLOITS worker, citizen and HUMAN RIGHTS under masks like FREE TRADE and the PATRIOT ACT - resulting in a return to a society of very rich and very poor dominated by a few very rich and powerful - whose voices are anything but - for the people. If left UNCHALLENGED, the self-serving interests of those in control may result in the end of DEMOCRACY, the end of the middle class, irreversible ENVIRONMENTAL damage to the planet, and widespread global poverty brought on by exploitation and supression of the voices of common people EVERYWHERE, while the United States turns into a REINCARNATION of the ROMAN EMPIRE. Author Thom Hartmann shares some history and outlines some basic steps to return our country to “The People” in his two articles TEN STEPS TO RETURN TO DEMOCRACY and SAVING THE MIDDLE CLASS. I support CERNIG’S idea for a new POLITICAL MOVEMENT - if not a revolution to cleanse our country of the filth ruling it - as we EVOLVE into a GLOBAL community - assuming we learn the THE LESSONS OF OUR TIME and don’t DESTROY CIVILIZATION first.
Everything here can be viewed anonymously. Inserting or commenting on articles requires a free user account (for former AT&T employees with a real, non throw-away, email address.) Requests to the new user registration page are redirected to BLOGGED DOT COM’S site because most new signups I get are from COMMENT SPAMMERS and their ilk, so if you want to contribute, contact me through email, phone, or some other way.
There’s no third-party scripts here like privacy-eroding WEB COUNTERS, hidden datamining widgets like Pay-Pal donation boxes, or AMAZON DOT COM tracking stuff. The RSS feeds are pulled by the server, and have no relation to anything you may be doing here. Standard Apache WEB LOGS of info like IP, and pages visited are rotated every few days, and used internally to check the web server’s performance. Logs of suspicious activity may be shared with law enforcement, or other ISPs, to deal with troublemakers. Nothing here is for sale, and donations are not solicited.
If you get an email that claims to be from somebody here that’s anything but a request to post your article, or report suspicious activity (like logs sent to an ISP to report an attack) - it’s SPAM. I do not, and will not - ever - join the junk mail sender community. There are no mechanisms to prevent anyone from forging anyone elses email address in a “from” or “reply-to” mail header. For those of us whose email addresses are fraudently used, the best we can do is filter out NDR REPORTS.
Per U.S.C. COPYRIGHT LAW - TITLE 17, SECTION 107, this not-for-profit site may reproduce copyrighted material not specifically authorized by the copyright owner. Such articles will either have a web link to the source, home page, and/or show credit to the author. If yours is here and you have a problem with that, send me an EMAIL, and I’ll take it off. Stuff I wrote carries a CREATIVE COMMONS LICENSE permitting non-commercial sharing. In addition, this site’s owner forbids insertion and injecting data of any kind - especially advertisements - into ours by any person or entity. Should you see a commercial ad that looks like it’s from here, please report it by sending me a tcpdump and/or screenshot in an EMAIL, then READ UP about how the PARTNERING OF INTERNET SERVICE PROVIDERS and companies like NEBUAD are DESTROYING INTERNET PRIVACY.
Resumes of layed off AT&T workers are posted for free HERE.
Links to some Telecom companies’ career pages are HERE.
Click HERE to learn a little about Article 43 and why I loathe the CWA.
Click HERE or HERE to learn what the CWA did when given a chance to do the right thing.
Click HERE for a glimpse of undemocratic and hypocritical CWA practices.
Click HERE for an article on Corporate Unionism.
Click HERE for an article of AFL-CIO’s undemocratic history.
This site can disappear anytime if I run out of money to pay for luxuries like food, health care, or internet service.
Discernment of truth is left to the reader - whose encouraged to seek as much information as possible, from as many different sources as possible - and pass them through his/her own filters - before believing anything.
...the Devil is just one man with a plan, but evil, true evil, is a collaboration of men…
- Fox Mulder, X Files
No matter how big the lie; repeat it often enough and the masses will regard it as the truth.
- John F. Kennedy
Today my country, your country and the Earth face a corporate holocaust against human and Earthly rights. I call their efforts a holocaust because when giant corporations wield human rights backed by constitutions and the law (and therefore enforced by police, the courts, and armed forces) and sanctioned by cultural norms, the rights of people, other species and the Earth are annihilated.
- Richard L. Grossman
Unthinking respect for authority is the greatest enemy of truth.
- Albert Einstein
He who is not angry when there is just cause for anger is immoral. Why? Because anger looks to the good of justice. And if you can live amid injustice without anger, you are immoral as well as unjust.
If you are neutral in situations of injustice, you have chosen the side of the oppressor. If an elephant has its foot on the tail of a mouse and you say that you are neutral, the mouse will not appreciate your neutrality.
- Bishop Desmond Tutu
Our lives begin to end the day we become silent about things that matter.
- Martin Luther King Jr
Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety.
- Benjamin Franklin
If we do not hang together, we will surely hang separately.
- Benjamin Franklin
We must be prepared to make heroic sacrifices for the cause of peace that we make ungrudgingly for the cause of war.
- Albert Einstein
Solidarity has always been key to political and economic advance by working families, and it is key to mastering the politics of globalization.
- Thomas Palley
The impending credit crisis cant be avoided, but it could be mitigated by taking radical steps to soften the blow. Emergency changes to the federal tax code could put more money in the hands of maxed-out consumers and keep the economy sputtering along while efforts are made to curtail the ruinous trade deficit. We should eliminate the Social Security tax for any couple making under $60, 000 per year and restore the 1953 tax-brackets for Americans highest earners so that the upper 1%-- who have benefited the most from the years of prosperity---will be required to pay 93% of all earnings above the first $1 million income. At the same time, corporate profits should be taxed at a flat 35%, while capital gains should be locked in at 35%. No loopholes. No exceptions.
Congress should initiate a program of incentives for reopening American factories and provide generous subsidies to rebuild US manufacturing. The emphasis should be on reestablishing a competitive market for US exports while developing the new technologies which will address the imminent problems of environmental degradation, global warming, peak oil, overpopulation, resource scarcity, disease and food production. Off-shoring of American jobs should be penalized by tariffs levied against the offending industries.
The oil and natural gas industries should be nationalized with the profits earmarked for vocational training, free college tuition, universal health care and improvements to then nations infrastructure.
Friday, August 15, 2014
Clear Routine Phone Home
Ever hear of clear-routine dot net?
A system generated email was addressed to them last month and another yesterday.
The body is a bunch of numbers.
What did I download that’s trying to tell THEM something?
What is that SOMETHING they want to learn?
Am I an unwitting victim of some flyby download that’s phoning home?
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Saturday, August 09, 2014
Can’t Find A Qualified US Worker Redux 2
Dear Mr. (name withheld),
Your top management apparently believes that making everyone else in the company feel powerless - including managers at your level - helps the bottom line. That’s been proven wrong, again and again. As the management guru Edwards Deming documented more than four decades ago, companies that empower employees by telling them what they need to accomplish and then giving them wide latitude to decide how best to do it perform far better than companies that dictate everything. A recent study by the Jackson Organization shows that “companies that effectively appreciate employee value enjoy a return on equity and assets more than triple that experienced by firms that don’t.”
I’d advise you to join with a half-dozen other managers at your level who understand this and approach top management together, starting with a memo outlining why the company’s current draconian policies are failing, and how other large companies are succeeding by giving their employees more responsibility rather than less (Costco, Apple, Proctor&Gamble, Starbucks), and suggesting a meeting to discuss. If top management has any shred of insight or integrity, it will follow up. Good luck to you.
- Robert Reich
People blossom when they feel loved. People who feel loved feel better about themselves. They’re more articulate, they take more risks out in the world, they’re able to be more independent. When people feel loved it grows them. Knowing that you matter to someone else and that someone has your back gives you a strength.
- Dr. Sue Johnson
A couple of generations ago when I got my tech job at AT&T - the first thing they did was send me for a few months to their school - AT&T University. Then six months as an apprentice working alongside a veteran technician - installing, maintaining, and troubleshooting equipment. After that I was allowed to work semi-solo for another six months - heavily monitored and coached. Finally I was officialy ordained a qualified technician and trusted to be alone with customers and the MAGIC that makes PHONE CALLS work.
Training never stopped. As new technology was introduced, I was sent to school for theory, then hands on.
I spent a lot of years working for AT&T as a highly skilled, highly productive technician. The company got a good worker, and paid us well with a good salary and benefits. Life was a win-win for everyone, until THINGS CHANGED.
The apprentice program has been around for eons - and works.
I don’t care how many books someone can throw at me on anything - without hands on experience, and without a little guidance by a seasoned veteran - it’s lacking.
Sure I can read a how-to guide on fixing a leaky faucet - but after I’m done reading, it’s off to the faucet to change a washer. And if my plumber friend were around, he can probably show me how the pros do it.
Would you trust a pilot that read reams of flight manuals but never flew a plane? Neither would I. Pilots go through school, and hours in a simulator before getting near a cockpit. Then they fly alongside a veteran pilot for another few thousand hours before getting their wings. How about a bus driver? Would you a trust a guy that read a bunch of books on proper bus driving techniques, knows exactly how many passengers a bus can safely hold - but never got behind the wheel? Neither would I.
How good can anyone be reading a book on web design, but never actually building a website, then trying to show somebody else how to build a website?
About as good as a fat slob showing you how to loose weight.
Did Bruce Lee get his black belt reading books how to throw a good punch?
TODAY in business the apprenticeship program - like LONGEVITY and GOOD JOBS - is all but gone. Companies hire TEMPORARY workers, or try to swindle the government to train its workers, threatening to offshore/outsource work if it doesn’t. Take the PLATFORM TO EMPLOYMENT. It’s much needed help for LONG-TERM unemployed BOOMERS, and a great idea in musical chairs - get the taxpayers to train older people while CEOS SING to the music of subsidized training and internships - and companies will HIRE THEM for what FEW JOBS are available, instead of young COLLEGE grads.
Then there’s the job I have today - an EXPRESSION of corporate ATTITUDES nowadays in CUSTOMER SERVICE. I’m an outsourced CALL CENTER rep for a company whose products and technology I know next to nothing about, yet a FIRST CONTACT for its technical support. Before being sent out to the production floor, I was was given some computer based reading material, and shown a couple of the products in a back room. Customers are annoyed and frustrated when they call in looking for help on hardware or software I’m supposed to be an expert on - but the only things I know come from that stuff I just read. How’s that for real world experience? When I mess up on a trouble ticket - which is easy with inadequate training and lack of exposure - the mistakes are shared by management both as an internal note on the ticket for all employees to see, and broadcast on an intracompany mail list. Some people work for free through lunch to catch up on their assignments which is often more work than can be handled without cutting corners and getting sloppy. Some do it to SUCK-UP to management, others fear getting fired for not keeping up with everyone else. The level of MICROMANAGEMENT makes the situation worse. And our inbound phone calls are recorded and monitored.
How effective and ENGAGING is that?
Which brings us to these articles.
Businesses’ Responsibility to Train And Reskill The Long-Term Unemployed
By Matt Ferguson
October 18, 2013
Even though the U.S. job market continues to operate far below its potential, many employers are EXPRESSING FRUSTRATION over the quality of job seekers applying to their open positions. In a survey from CareerBuilder and Harris Interactive, 8 in 10 employers expressed concern over an emerging skills gap, but interestingly, only 4 in 10 employers believed their organizations were doing anything to close it.
To fix skill shortages in the near and long term, employers simply have to play a larger role in the process of training and reskilling.
Of course, there are many OTHER FACTORS critical to navigating the competitive talent market. Those include eliminating HIRING PRACTICES that inadvertently screen out qualified candidates, studying labor supply and demand data to see where top talent resides, and ensuring wages are both competitive and rising for skilled positions. Ultimately, however, more companies must take ownership of the problem by developing the skills they need internally.
While researching my forthcoming book, The Talent Equation, my co-authors and I spoke with executives at Humana, who at the time were finishing up the first phase of an initiative to hire 1,000 veterans or spouses of veterans in an effort to combat extremely high unemployment rates for post-9/11 service members. They proudly achieved their goal and were thrilled with the quality of their new hires. However, much of their success rested on their ability to hire for potential and train individuals who on paper may not have seemed like the perfect fit, but had enormous potential to succeed when given the right tools.
Humana’s and other companies’ efforts to reduce veteran unemployment is a learning moment. If we can acknowledge the ability of veterans and reward them with a job and training opportunities, I am confident the same can be done for the long-term unemployed.
This is an issue critical to securing an economic future that includes all Americans who seek to contribute. The share of the unemployed population that has been out of work for more than 27 weeks is nearly 40 percent - a high figure not reached in previous recoveries. As it stands now, the long-term unemployed, whether veterans or workers near the end of their careers, are at risk of being permanently left out of the workforce if their skills atrophy and their connections to the job market deteriorate.
Unfortunately, many companies have cut internal training programs or simply aren’t in the practice of teaching workers new technical skills. A 2012 CareerBuilder survey found that 47 percent of U.S., nongovernment employers either have no training budgets at all or have training budgets under $25,000 annually. Workers sense the dearth of training opportunities as well. Only 21 percent of workers said they’ve acquired a new skill through company-provided training over the previous five years, according to an Accenture survey.
Many companies argue that training for technical skills presents a risk. Why give a new worker a skill they can easily take to a competitor who didn’t make the same investment? But actually, empowering employment via training is a driver of retention and productivity gains if done well. A 2013 CareerBuilder survey found skills training and learning opportunities to be a better retention tactic for full-time workers than decreased workloads, academic reimbursement, and perks such as subsidized lunches, game rooms, or casual dress codes. Another study showed that training boosts productivity significantly more than labor costs, a signal that companies will reap the rewards of their investment.
It’s also possible to successfully train for technical skills in fast-growing information technology occupations over a short period of time and still produce skilled, functional employees. To test this hypothesis CareerBuilder hired ten long-term unemployed individuals in 2012 for a six-month, paid internship and trained them in Structured Query Language (SQL)—a programming language used for database management systems. Shortly after completing the program, seven of the interns landed full-time jobs and one went to school to earn a formal technology degree. We ran the program again in 2013 with similar success.
Some companies can’t afford to be at full staff, let alone establish a new training program. That’s understandable. But at a certain point we have to consider alternatives. If every employer capable of training for technical skills decides it’s not their responsibility, the very skill shortages hiring managers cite as a perennial concern will only be exacerbated.
It’s also important to note that extended vacancies come at a cost. One in four companies tells us they’ve lost revenue as a result of unfilled positions. Many more cite sinking morale among existing employees and reduced productivity. In light of this, an employer that is unable to fill key positions should question whether waiting for the perfect hire is worth these costs when an eager candidate can very likely learn the required skills and succeed in the role. I’m hopeful more companies will come to realize they have the tools to bring long-term unemployed workers back from the fold, thereby turning the page on one of the post-recession labor market’s most important issues.
This post is part of a series produced by The Huffington Post and the “Close It” Summit, in conjunction with the upcoming “Close It” Summit (Nov. 5-7, 2013, in Washington, D.C.). The summit will address the U.S. job-market skills gap. For more information on the conference, please VISIT.
Time to Focus on Your Best Performers
Your highest-performing employees may be just the ones most likely considering leaving your organization for another opportunity, especially since those with the strongest skills are generally also those in the highest demand. Keeping those employees is paramount for your organization’s success.
By Renee Charney and Carol A. Gravel
February 14, 2014
As the U.S. economy continues to show signs of life, organizations everywhere are slowly regaining their optimism. Recent job numbers show that applications for unemployment benefits are dropping and most months the jobs report continues to show a healthy net increase in the number of private-sector opportunities. The fact that companies are again hiring is good news, of course. But as employers, leaders, and Human Resources executives, we need to be aware that job growth also means more opportunities for employees who may wish to leave their current positions. If people are not happy where they are, if they’re not fully engaged, they may decide to go elsewhere.
Research and practice tells us that if your employees are not fully engaged they are more likely to seek employment elsewhere, i.e. to jump ship. In addition, as we see an increase in employment, people who have until now chosen to stay with their current employer may very well begin looking for other options that are more in line with their needs. A recent Yale University study of job mobility patterns over a 30-year period found that job mobility dramatically increases after a recession. To retain high-performing employees, it is vital to identify effective strategies to engage and retain your top talent.
A key element in employee retention is employee empowerment. Employee empowerment is not just a recent buzz word; it is in fact a planned and continued effort to provide employees with the ability to grow professionally, to take risks, and to make decisions on their own. The benefits of employee empowerment are well known. A small-business series published in the Houston Chronicle confirms that employee empowerment results in improved productivity, overall cost reductions and improved morale (just to name a few), all elements that directly relate to employee retention.
We recommend four specific ways to lay the groundwork for the kinds of empowerment that lead to highly engaged employees (and, therefore, to increased retention of your best performers):
Engage in Authentic and Transparent Conversations. This may sound simple, but too often we’ve seen leaders err on the side of sharing too little information with their teams rather than too much. In a Forbes article from 2011, leadership development consultant Kristi Hedges wrote that “authenticity is paramount and palpable.” She goes on to say that, “We are drawn to people as individuals, not as concepts such as business owner or boss. Great leaders take the time to really know others.” Engaged employees want to work for leaders who are self-aware, sharing, and trusting. That starts with openness. That openness models a behavior that your employees will pick up on and likely begin to model with their peers.
Challenge People. Often very talented people can fall into a “comfort zone,” a particular set of responsibilities where they feel safest. Empowering people also means pushing them a little bit and stretching them to find the edges of their comfort zones while at the same time providing the support that allows them to effectively face these new challenges. According to Jackson and Parry’s 2011 book titled A Very Short, Fairly Interesting and Reasonably Cheap Book about Studying Leadership, this practice of providing learning opportunities for your employees, coupled with demonstrating authentic and transparent leadership, increases the likelihood of dedicated and engaged followership.
Encourage Risk Taking. David Packard, American philanthropist and a founding half of Hewlett-Packard, said this: “Take risks. Ask big questions. Don’t be afraid to make mistakes; if you don’t make mistakes, you’re not reaching far enough.” How often do we, as leaders, encourage rather than discourage risk taking? Engaged employees want to take chances, want to try new things, and followers who work in an environment where they are trusted to learn from their mistakes are more likely to increase their discretionary efforts. Sure, they’ll fall down, and that’s when it’s a leader’s job to help them up. So let them take chances; let them reach “far enough.”
Give Trust. Too often in our culture we talk of having to earn trust, as if trust is some currency that can be passed from hand to hand. In our view, trust is something to give as well as earn, and one way to engage effectively with your employees is simply to assume trust. As often as not, your lack of trust may end up being self-fulfilling. Try it the other way, giving trust rather than forcing it to be earned. In the words of Susan Scott, author of the book Fierce Leadership, “Don’t just hold them accountable—hold them able!” You’ll be amazed at how often people will live up to your expectations—and will trust you all the more for trusting them.
These four strategies serve to create environments where employees will be more willing to step up or lean in, more willing to challenge themselves, and more willing to assume accountability for results. The four strategies help you to create an environment where people feel empowered. Empowered employees will fuel your company—and will want to stay on your ship—versus someone else’s.
We note, however, that employee empowerment also brings with it some changes for leaders. For many leaders it may seem easier to manage with a directed approach, but “micro-management” will in fact stifle employee empowerment. As Richard Porterfield, author of “The Perils of Micromanagement” writes: “Managers who insist on being involved in every detail demoralize their employees, add unnecessary stress to their own lives, and endanger their organization’s long-term success.” Leaders need to recognize that empowering their staff means they may need to learn new leadership skills.
There’s also the question of organizational alignment. One of the key elements of employee empowerment is that employees make decisions and take risks. You should align your teams and departments to ensure collaboration but also to focus on achieving the organizational goals. If your organization is not aligned to create awareness of what other groups are doing, as well as a clear understanding of the organizational goals, empowered employees will not be able to help your organization be successful.
We encourage you to begin practicing these four simple strategies for retaining your high-performing employees. Start with one team or one department to begin with and learn from that experience. Leaders who engage and empower employees to achieve the organization’s goals provide an opportunity for individuals and teams to contribute to the overall success of the organization. That success, and the empowering behaviors that lead to it, are the keys to retaining your best employees.
Renee Charney is the Founder and President of Charney Coaching & Consulting LLC, a New Hampshire-based leadership and organizational-consulting company. She can be reached at rcharney at charneycc.com. Carol A. Gravel is an associate professor of human resource management at Franklin Pierce University, where she is the program director for the MBA/HRM program and is the faculty advisor for the Franklin Pierce University SHRM student chapter. She can be reached at gravelc at franklinpierce.edu.
Section Dealing with Layoff • Section Dying America •
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How Will Historians View Us?
Our era will be seen as a bleak period - another Gilded Age - but worse
By Neal Gabler
July 12, 2014
History is a lot like forestry. In the latter, you often cant see the forest for the trees, and in the former you often can’t see the epoch for the incidents. Though it hardly seems as momentous as the Great Depression or the civil rights era, our current period may be one of the most significant in American history one that may well determine what kind of country we will be for decades hence. To put our own times in focus, it helps to ask: What will historians 50 or 150 years from now think of the early 21st century?
It is an apt question, because history has a way of challenging and altering the perceptions that any time has of itself. In its own day, for example, the 1920s were a boon period that gave rise to national free-spiritedness. In the long eye of history, they were the myopic prelude to the Great Depression. In his own day, Harry Truman was an accidental president, a pipsqueak who couldnt fill FDRҒs shoes. In the long eye of history, he is regarded as one of our most successful presidents, navigating the sticky post-war period internationally, and helping propel an economic boom domestically.
Predicting the historical long view is a risky proposition, but let me hazard a guess: Historians will wonder what bizarre convulsions this nation was going through how it seemed to lose its moral, political, and economic bearings, how the gains of social and economic equality that were a century in the making were reversed, and, above all, how the country actually became less democratic, often with the acquiescence of many ordinary Americans.
The first thing historians are likely to fasten on is the historic economic inequality in America today. As the French economist Thomas Piketty has documented in his pathbreaking book, “Capital in the 21st Century, America,” the vaunted land of opportunity, has become one of the most unequal nations in the history of the world when it comes to wealth distribution - a country in which the top 1 percent own nearly 40 percent of the nations wealth.
Historians will certainly also focus on the fight to disenfranchise poor and minority voters after 100 years of advancing civil rights. They will discuss how the Supreme Court and the Republican Party succeeded in rolling back many of those achievements - the court by ripping out a central provision of the Voting Rights Act, and Republican state legislatures by imposing onerous voter registration restrictions that, lets face it, have one aim only: to suppress minority voting, which is likely to tilt Democratic.
They will cite the role of money in politics and the sudden turnabout by the Supreme Court in the Citizens United and McCutcheon decisions, which released a torrent of big money into American politics.
They will look at the nation’s increasing churlishness its reluctance to embrace health reform that would provide insurance to those who cannot otherwise afford it, its willingness to cut benefits, like food stamps, that primarily help the young and the elderly, its grudging extension of unemployment benefits to people afflicted by the economic downturn.
And historians will say that these are not discrete things but that they coalesce to form what may be called the age of inequality. Historians are also likely to see how this age of inequality answered what has been arguably the nation’s foremost question from its founding: Is America to be an aristocracy or a democracy? Ever since Andrew Jackson, the thrust, with a few detours, has been toward democracy. Historians will show that had changed in the late 20th and early 21st century, not necessarily because most Americans wanted economic inequality, voter suppression, big money in politics, or cruelty to the poor but because the system wasnt responsive to them. It had become oligarchic.
I suspect that historians will view this as a terribly bleak period - another Gilded Age but worse. They will observe that the ever-fragile democratic enterprise was hijacked, perhaps permanently. They will mainly blame the Republicans, though if Republicans will be accused of lacking heart and brains in promulgating these policies, Democrats will be accused of lacking guts in not fighting them more strenuously. They will show how Ronald Reagans seeds of economic inequality finally sprouted into our society of the super-rich and everyone else.
And they will wonder: Why there was so little resistance?
The answer is complex, but it seems to have two primary components. The first is that resistance is basically futile, and everyone knows it. The wealthy have always worked the levers of power, and though we have had periods of greater equality - the period from the end of the Great Depression to the beginning of Reagans presidency - America is more or less an oligarchy by design. The only difference now is that there is nothing surreptitious about it.
And that leads to the second component. As intellectuals are fond of saying, ideas have consequences. It is just that the consequences may have less to do directly with policy than with mythology. The prevailing mythology has been that the wealthy are deserving of their spoils - that they are a living example of the proposition that anyone who wants to make it in America can. Of course, people want to believe that, but it provides great cover for inequality. You almost feel un-American protesting that it isn’t remotely true.
So the country rolls on, and it rolls back. And historians will wonder how the 21st century came to resemble the end of the 19th a terrible time when the wealthy ruled and everyone else capitulated.
Neal Gabler is author of “Walt Disney: The Triumph of the American Imagination.”
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Tuesday, August 05, 2014
Defining Away Economic Failure
Redefinition Is Americas Most Powerful Factor of Production
By Dr. Paul Craig Roberts
August 4, 2014
Last week’s government guesstimate that second quarter 2014 real GDP growth will be 4% seems nonsensical on its face. There is no evidence of increases in real median family incomes or real consumer credit that would lift the economy from a first quarter decline to 4% growth in the second quarter.
Middle class store closings (Sears, Macys, J.C. Penney) have spread into the Dollar stores used by those with lower incomes. Family Dollar, a chain in the process of closing hundreds of stores is being bought by Dollar Tree, the only one of the three Dollar store chains that is not in trouble. Wal-Mart’s sales have declined for the past 5 quarters. Declining sales and retail store closings indicate shrinking consumer purchasing power. Retail facts do not support the claim of a 4% GDP growth rate for the second quarter, and they do not support last Fridays payroll job claim of 26,700 new retail jobs in July.
What about the housing market?
Don’t the headlines accompanying last Friday’s payroll jobs report, such as “Hiring Settles Into Steady Gains,” mean more people working and a boost to the economy from a housing recovery? No. What the financial press did not report is that the US is in a structural jobs depression. In the 12-month period from July 2013 through July 2014, 2.3 million Americans of working age were added to the population. Of these 2.3 million only 330 thousand entered the labor force. My interpretation of this is that the job market is so poor that only 14% of the increase in the working age population entered the labor force.
The DECLINE IN THE LABOR FORCE participation rate is bad news for the housing market. The US labor force participation rate peaked at 67.3% in 2000 and has been in a sustained downturn ever since. The rate of decline increased in October 2008 with the bank bailout and Quantitative Easing. From October 2008 to the present, 13.2 million Americans were added to the working age population, but only 818 thousand, or 6%, entered the labor force. Despite government and financial press claims, the Federal Reserve’s multi-year policy of printing money with which to purchase bonds did not restore the housing or job markets.
What about the stock market?
It has been down in recent days but is still high historically. Isnt the stock market evidence of a good economy? Not if stocks are up because corporations are buying back their own stock. Corporations are now the largest buyers of stocks. Recently we learned that from 2006 through 2013 corporations authorized $4.14 trillion in buybacks of their publicly traded stocks. Moreover, it appears that corporations have been borrowing the money from banks with which to buy back their stocks. Last year there were $754.8 billion in authorized stock buybacks and $782.5 billion in corporate borrowing. In the first three months of this year, COMPANIED PURCHASED $160 billion of their own stocks.
Borrowing to buyback stock leaves a company with debt but without new investment with which to produce revenues to service the debt. The massive stock buybacks demonstrate that American capitalism is now corrupt. In order to maximize personal short-term financial benefits flowing from bonuses, stock options, and capital gains, CEOs, boards of directors, and shareholders are decapitalizing public companies and loading them up with debt.
Well, isn’t the economy being helped by the return of manufacturing to America? Apparently not. Data for 1999-2012 indicate that the offshoring of manufacturing increased by 9%.
One economist, Susan Hester, an economist for the Retail Industry Leaders Association, has decided to turn the loss of MANUFACTURING JOBS into a virtue. Her argument is that retail employment dwarfs manufacturing employment and that more American jobs can be created by selling more imports than by encouraging manufacturing in order to provide exports.
According to Ms. Hesters research, the US makes more money from the retail side than from the production side. She concludes that the value added to a product by offshore labor is a small percentage of the value added by managing offshored production, handling Customs clearances, managing warehouses and distribution, marketing apparel products, and by millions of people in the retail sector stocking shelves and working cash registers.
In other words, the US manufacturing jobs moved offshore are just a throwaway. The money is made in selling the imports.
Ms. Hester neglects to recognize that when offshored production is brought to the US to be marketed, it comes in as imports and results in a larger US trade deficit.
Foreigners use dollars paid to them for the products that they make for US firms to purchase ownership of US bonds, stocks, and real assets such as land, buildings, and companies. Consequently, interest, profits, capital gains, and rents associated with the foreign purchases of US assets now flow to foreigners and not to Americans. The current account worsens.
It works like this: The excess of US imports over US exports leaves foreigners with claims on US income and wealth that are settled by foreign purchases of US assets. The income produced by these assets now flows abroad with the consequence that income earned by foreigners on their US investments exceeds the income earned by the US on its foreign investments.
According to Ms. HesterԒs reasoning, Americans would be better off it they produced nothing that they need and in place of manufacturing relied on the incomes of US fashion designers and pattern makers who specify the offshored production for US markets, on the compliance officers and freight agents, on production planning and expediting clerks, and on longshore workers and railroad employees who deliver the foreign-made goods to US consumer markets.
Ms. Hester believes that the value-added by offshored manufacturing is inconsequential. How then did China get rich from it, becoming the second largest economy and employing 100 million people in manufacturing (compared to Americas 12 million), and acquire the largest foreign reserves of any country?
After Ms. Hester answers that question she can explain why US corporations go to the trouble to offshore their manufacturing if the contribution to value-added is so low? The value added is obviously substantial enough for the labor cost savings to pay for transportation costs to the US from Asia, for the cost of set-up and management of foreign based facilities, and for the cost of the adverse publicity from abandoning US communities for Asia and still leave value-added after all costs to enlarge profits and drive up stock prices and executive bonuses.
Ms. Hester fools herself. The low value that she calculates Chinese, Indian, or Vietnamese labor adds to the price of a shirt reflects the low foreign labor cost, not a low value of the shirt in US markets or a low value of an iPhone in European markets. Marketing, warehousing and distribution are done in the US by more highly paid people, and this is why it looks like the value added comes from sources other than manufacturing. Ms. Hester overlooks that the lower cost of foreign labor does not translate into a less valued product but into higher profits.
Economists assume that the labor cost savings are passed on to the consumers in lower prices, but I have not experienced declining prices of Nike and Merrell sports shoes, of sheets and towels, of Brooks Brothers and Ralph Lauren shirts, of Apple computers, or whatever as a result of moving US production offshore. The labor cost savings go into profits, managerial bonuses, and capital gains for shareholders and is one reason for the extraordinary increase in income and wealth inequality in the US.
Focused on short-term profit, manufacturers and retailers are destroying the US consumer market. The average annual salary of a US apparel manufacturing worker is
$35,000. The average salary of US retail employees is less than half of that amount and provides no discretionary income with which to boost consumer spending in retail stores.
The American corporate practice of offshoring manufacturing has made it impossible for the Obama regime to keep its promises of creating manufacturing jobs and exports. Unable to create real jobs and real exports, the US government has proposed to create virtual jobs and virtual exports made by factoryless goods producers. In order to keep his promise of doubling the growth of US exports, the Obama regime wants to redefine foreign output as US output.
A factoryless goods producer is a newly invented statistical category. It is a company like Nike or Apple that outsources the production of its products to foreign companies. The Obama regime is proposing to redefine companies such as Apple that own a brand name or a product design as manufacturing companies even though the companies do not manufacture.
In other words, whether or not a US company is a manufacturer does not depend on its activity, but on its ownership of a brand name made for the company by a foreign manufacturer. For example, Apple iPhones made in China and sold in Europe would be reported as US exports of manufactured goods, and iPhones sold in the US would no longer be classified as imports but as US manufacturing output. Apple’s non-manufacturing employees would be transformed into manufacturing employment.
Clearly, the purpose of this statistical deception is to inflate the number of US manufacturing jobs, US manufacturing output, and US exports and to convert imports into domestic production. It is a scheme that eliminates the large US trade deficit by redefinition.
The reclassification would leave the governments Office of Statistical Lies with the anomaly that products made in China, India, Indonesia or wherever become US GDP as long as the brand name is owned by a US corporation, but the payments to the Asian workers who produced the products remain as claims on US wealth and can be converted into ownership of US bonds, companies, and real estate.
For example, Chinese workers produced the Apple products, and China has the claims on US wealth to prove it. How are these claims accounted for statistically by the Obama regimeҒs redefinition? The US can add Chinas production of the Apple products to US GDP, but how does the US deduct the Chinese-produced Apple products from ChinaҒs GDP? And how does the Obama regimes redefinition get rid of the payments by Apple to the Chinese labor that produced the products? These payments comprise claims on US wealth.
In other words, the reclassification would double count the output of AppleҒs products. If every country does this, world GDP will rise statistically regardless of the fact that no more goods and services are produced. Perhaps this is the way to define away world poverty.
Factoryless goods producersӔ was foreshadowed by Harvard professor Michael Porters 2006 competitiveness report, a justification for jobs offshoring. Defending jobs offshoring, Porter downplayed the rise in the US trade deficit and decline in the US GDP growth rate caused by jobs offshoring. Porter argued, in effect, that ownership of the revenues and products, not the location in which the revenues and products are produced, should determine their classification. As I pointed out in my critique (see The Failure of Laissez Faire Capitalism and Economic Dissolution of the West), the result would be to raise US GDP by the amount of US production outsourced abroad and by the output of US overseas subsidiaries and to decrease the GDP of the countries in which the manufacturing actually takes place. Consistency would require that the German and Japanese autos, for example, that are produced in the US with US labor would become deductions from US GDP and be reported as German and Japanese GDP.
As I have emphasized for years, the West already lives in the dystopia forecast by George Orwell. Jobs are created by hypothetical add-ons to the reported payroll figures and by inappropriate use of seasonal adjustments. Inflation is erased by substituting lower priced items in the inflation index for those that rise in price and by redefining rising prices as quality improvements. Real GDP growth is magicked into existence by deflating nominal GDP with the understated measure of inflation. Now corporations without factories are going to produce US manufacturing output, US exports, and US manufacturing jobs!
Every sphere of Western existence is defined by propaganda. Consequently, we have reached a perfect state of nihilism. We can believe nothing that we are told by government, corporations, and the presstitute media.
We live in a lie, and the lie is ever expanding.
Section Dying America •
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