26.11.2012
Policy Points
Economic historian Robert Skidelsky argues that “inequality is killing capitalism.”
Let us agree that people are greedy, and that they always want more than they can afford. Why, then, did this “greed” manifest itself so manically?
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To answer that, we must look at what was happening to the distribution of income. The world was getting steadily richer, but the income distribution within countries was becoming steadily more unequal. Median incomes have been stagnant or even falling for the last 30 years, even as per capita GDP has grown. This means that the rich have been creaming off a giant share of productivity growth.
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And what did the relatively poor do to “keep up with the Joneses” in this world of rising standards? They did what the poor have always done: got into debt. …
26.11.2012
Policy Points
James Kwak minces no words in a a blog post for The Atlantic.
So the real point isn’t that we can’t afford Social Security and Medicare. It’s that some people don’t want to pay the higher taxes necessary to maintain Social Security and Medicare. This is a question of distribution, pure and simple.
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At first blush, it may appear that young people don’t want to pay for retirement benefits and health care for old people. But most of us will be both young and old at different points in our lives, so we’re on both sides of the transfer. The real issue is that Social Security and Medicare are risk-spreading programs, which means that rich people end up subsidizing poor people.
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When people say that we can’t afford our entitlement programs, they’re really saying that rich people won’t pay the taxes necessary to sustain our entitlement programs. To be fair, many rich people probably would be willing to pay higher taxes if they knew the facts. But a small number of extremely rich people have successfully spread the myth that we can’t afford our entitlement programs.
16.11.2012
News Releases, Policy Points
CHAPEL HILL, NC (November 16, 2012) – In October, employers in North Carolina added 8,000 more payroll positions than they eliminated (+0.2 percent), thanks to hiring across a range of private-sector industries. Also in October, the number of employed North Carolinians increased, while both the number of unemployed persons and the statewide unemployment rate fell. The October unemployment rate of 9.3 percent was the lowest one recorded since January 2009, when the rate equaled 9 percent. These findings come from new data released by the Labor and Economic Analysis Division of the NC Department of Commerce.
“North Carolina’s labor market grew in October, as measured by a number of important indicators,” said John Quinterno, a principal with South by North Strategies, Ltd., a research firm specializing in economic and social policy. “The overall number of jobs in the state rose to 3.96 million, the size of the labor force increased to 4.71 million, the number of employed persons grew to 4.23 million, and the number of unemployed person fell to 0.44 million. The unemployment rate dropped to 9.3 percent, the lowest level recorded since early 2009.”
In October, North Carolina employers added 8,000 more jobs than they cut (+0.2 percent). Private-sector payrolls netted 8,900 positions (+0.3 percent), while public-sector payrolls shed 900 jobs (-0.1 percent), due to cuts in state government payrolls (-3,800, -2 percent). Within the private sector, leisure and hospitality services netted the most jobs (+3,600, +0.9 percent), with 75 percent of the growth occurring in the arts, entertainment, and recreation subsector. The trade, transportation, warehousing, and utilities sector netted 2,900 jobs (+0.4 percent), with 58.6 percent of the gain tied to the retail subsector. Manufacturing payrolls expanded by 2,600 jobs (+0.4 percent), followed by the other services sector (+2,400 jobs, +1.6 percent). The only sectors to shed jobs were professional and business services (-3,400, -0.6 percent), education and health services (-1,800, -0.3 percent), and mining and logging (-100, -1.8 percent).
A revision to the September payroll data found that the state gained more jobs than first estimated (+3,900 versus +100). With that revision, North Carolina now has, on net, 211,900 fewer payroll positions (-5.1 percent) than it did in December 2007. Since bottoming out in February 2010, the state has netted an average of 3,575 payroll jobs per month, leading to a cumulative gain of 114,400 positions (+3 percent).
“North Carolina’s labor market posted relatively strong growth in the first quarter of 2012, stumbled in the second quarter of the year, stagnated in the third quarter, but began the fourth quarter on a somewhat promising note,” added Quinterno. “North Carolina now has 32,600 more jobs than it did at the start of the year. The general pattern of 2012 has been one of modest growth in the private sector offset by modest declines in the public sector.”
The household data for October also offered an improved view of labor market conditions. Last month, the unemployment rate fell to 9.3 percent, the lowest level recorded since January 2009, when the statewide rate equaled 9 percent. Last month, the number of employed North Carolinians rose (+43,699, +1 percent), as did the overall size of the labor force (+34,678, +0.7 percent). The number of unemployed persons dropped by 9,021 (-0.3 percent).
Over the past year, the total number of unemployed North Carolinians has fallen by 53,054 persons (-10.8 percent), and the number of employed persons has grown by 95,425 persons (+2.3 percent). The unemployment rate also has fallen by 1.3 percentage points, dropping to 9.3 percent from 10.6 percent. In short, more people are working than was the case a year ago.
That said, the recent growth in the statewide labor market is weak in relation to the severity of the employment problems facing the state. North Carolina’s unemployment rate has equaled or exceeded 9 percent in every month since January 2009 and has ranged as high as 11.4 percent. Compared to December 2007, which was when the “Great Recession” began, the statewide unemployment rate is 4.3 percentage points higher, and the number of unemployed North Carolinians is 92.2 percent larger. During the first 10 months of 2012, an average of 449,263 North Carolinians were unemployed in any given month.
Other troubling labor market indicators include a statewide unemployment rate that has exceeded 10 percent in 35 of the last 46 months and depressed labor force participation rates and employment-to-population ratios. Although the labor force participation rate and employment-to-population ratio both rose in October for the second consecutive month, the two measures remain near 36-year lows.
“The October job report contained a number of positive findings, in terms of data related both to employer payrolls and to the labor market experiences of individual households,” observed Quinterno. “The improvements, while welcome, should not blind policymakers to the severity of the problems facing the labor market. North Carolina’s labor market remains scarred by a massive jobs gap, slow payroll growth, and widespread unemployment. North Carolina’s labor market is by no means on the road to a robust recovery.”
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