(What’s Left of) Our Economy: Can Crypto Narrow the U.S. Racial Wealth Gap?

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African Americans, bitcoin, blacks, cryptocurrencies, digital currencies, finance, Hispanics, inequality, investing, investment, Latinos, personal finance, racial wealth gap, wealth, wealth gap, whites, {What's Left of) Our Economy

Shares of Americans who say they’re “familiar” with

cryptocurrencies:

 

Whites: 37 percent

Hispanics: 49 percent

Blacks: 50 percent

 

Shares of Americans reporting owning cryptos:

Whites: 11 percent

Hispanics: 17 percent

Blacks: 23 percent

 

(Source: “Black, Latino, LGBTQ investors see crypto investments like bitcoin as ‘a new path’ to wealth and equity,” by Charisse Jones and Jessica Menton, USA TODAY, August 13, 2021, https://www.usatoday.com/story/money/2021/08/13/crypto-seen-path-equity-black-latino-and-lgbtq-investors/5431122001/?gnt-cfr=1)

Im-Politic: Biden’s Latest Americans Last Immigration Policy

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America First, Biden, Border Crisis, border security, Central America, Chobani, cities, corruption, crime, El Salvador, foreign aid, gang violence, governance, Guatemala, Honduras, Im-Politic, immigrants, Immigration, inequality, Kamala Harris, Mastercard, Microsoft, migrants, Northern Triangle, racial economic justice, urban poverty

As known by RealityChek regulars, I’m deeply skeptical that the Biden administration can bring migrant flows from Central America (or similar regions) under control by adequately improving the miserable local conditions that (understandably) drive so much flight northward to begin with. But the first detailed description of this policy that I’ve seen not only ignores all of the intertwined institutional, governance, and cultural obstacles to turning regions like Central America’s Northern Triangle (El Salvador, Guatemala, and Honduras) into even approximations of success stories. It also casts real doubt on the seriousness of the vaunted domestic social justice and inequality commitments made both by President Biden and by at least some of the U.S. corporate sector.

As argued by a White House Fact Sheet released yesterday, support for economic development in these long-impoverished, abusively ruled countries will “require more than just the resources of the U.S. government.” Also essential “to support inclusive economic growth in the Northern Triangle” will be the “unique resources and expertise” of the private sector.”

It’s true that only three completely private, profit-seeking American companies have responded so far to the “Call to Action” for business involvement issued by Vice President Kamala Harris, who’s the administration’s designated czarina for dealing immigration-wise with the Northern Triangle. But let’s say lots more get involved.

Why would anyone capable of adult thinking believe that their efforts will succeed? After all, the administration acknowledges that economic success in the region depends on overcoming its “long-standing impediments to investment-led growth.” And it specifies that these obstacles include governments that simultaneously either can’t or won’t carry out their duties in corruption-free ways, and are unable to provide minimal levels of security for their populations against criminal gangs.

Meaning that private businesses will be keen even on setting up the kinds of training and business incubator and internet connectivity programs that predominate in their Northern Triangle plans while threats of violence and extortion remain omnipresent? Maybe they’re planning to cope by hiring massive  private security forces – but such precautions were never mentioned in the Call to Action announcement.

Just as important, here’s another major head-scratcher, especially given the flood of promises over the last year or so from U.S. business circles about promoting racial economic and financial equality. If companies are willing to wade into dangerous environments to educate populations, build or strengthen the infrastructure needed for significant economic progress, and foster new businesses in Central America, why aren’t they focusing their efforts on America’s own inner cities, or at least focusing more tightly on these efforts first? It’s not like their needs aren’t pressing. And although the Northern Triangle countries have actually made some noteworthy progress in fighting violent crime lately, they’re still much more dangerous places than even most of America’s homicide capitals.

Consequently, for companies concerned overall with actual results, it would make far more sense to take an America First approach. Not that Microsoft, Chobani, and Mastercard have ignored their disadvantaged compatriots in practice. But even as their U.S. efforts remain pretty modest (Microsoft, e.g., to date has only launched its digital skills and access improvement program in Atlanta and Texas, and Chobani’s incubator program still seems pretty small scale), they’ve decided to head south of the border(s).

Incidentally, the entire Biden Central America and overall immigration policies are vulnerable to a similar criticism. Since however difficult it’s going to be to spur racial and other economic and social progress at home, the challenge will be far more difficult in foreign countries, a President truly committed both to these vital domestic goals and to staunching migrant flows would focus focus his economic development programs on his own country, and deal with the migrants as an immigration issue – by securing the border. Unfortunately for Americans, Joe Biden has been anything but that President.

Im-Politic: VP Debate Questions That Should be Asked

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1619 Project, African Americans, Barack Obama, Biden, budget deficits, CCP Virus, censorship, China, Confederate monuments, Constitution, coronavirus, COVID 19, education, election 2020, Electoral College, filibuster, Founding Fathers, free speech, healthcare, history, history wars, Im-Politic, inequality, investment, Kamala Harris, Mike Pence, national security, Obamacare, police killings, propaganda, protests, racism, riots, semiconductors, slavery, spending, Supreme Court, systemic racism, Taiwan, tariffs, tax cuts, taxes, Trade, trade war, Trump, Vice Presidential debate, Wuhan virus

Since I don’t want to set a record for longest RealityChek post ever, I’ll do my best to limit this list of questions I’d like to see asked at tonight’s Vice Presidential debate to some subjects that I believe deserve the very highest priority, and/or that have been thoroughly neglected so far during this campaign.

>For Vice President Mike Pence: If for whatever reason, President Trump couldn’t keep the CCP Virus under control within his own White House, why should Americans have any faith that any of his policies will bring it under control in the nation as a whole?

>For Democratic candidate Senator Kamala Harris: What exactly should be the near-term goal of U.S. virus policy? Eliminate it almost completely (as was done with polio)? Stop its spread? Slow its spread? Reduce deaths? Reduce hospitalizations? And for goals short of complete elimination, define “slow” and “reduce” in terms of numerical targets.

>For Pence: Given that the administration’s tax cuts and spending levels were greatly ballooning the federal budget deficit even before the virus struck, isn’t it ridiculous for Congressional Republicans to insist that total spending in the stimulus package remain below certain levels?

For Harris: Last month, the bipartisan Congressional Problem Solvers Caucus unveiled a compromise stimulus framework. President Trump has spoken favorably about it, while stopping short of a full endorsement. Does Vice President Biden endorse it? If so, has he asked House Speaker Nancy Pelosi to sign on? If he doesn’t endorse it, why not?

For Pence: The nation is in the middle of a major pandemic. Whatever faults the administration sees in Obamacare, is this really the time to be asking the Supreme Court to rule it un-Constitutional, and throw the entire national health care system into mass confusion?

For Harris: Would a Biden administration offer free taxpayer-financed healthcare to illegal aliens? Wouldn’t this move strongly encourage unmanageable numbers of migrants to swamp U.S. borders?

For Pence: President Trump has imposed tariffs on hundreds of billions of dollars’ worth of Chinese exports headed to U.S. markets. But U.S. investors – including government workers’ pension funds – still keep sending equally large sums into Chinese government coffers. When is the Trump administration finally going to plug this enormous hole?

For Harris: Will a Biden administration lift or reduce any of the Trump China or metals tariffs. Will it do so unconditionally? If not, what will it be seeking in return?

For both: Taiwan now manufactures the world’s most advanced semiconductors, and seems sure to maintain the lead for the foreseeable future. Does the United States now need to promise to protect Taiwan militarily in order to keep this vital defense and economic knowhow out of China’s hands?

For Pence: Since the administration has complained so loudly about activist judges over-ruling elected legislators and making laws themselves, will Mr. Trump support checking this power by proposing term limits or mandatory retirement ages for Supreme Court Justices? If not, why not?

For Harris: Don’t voters deserve to know the Biden Supreme Court-packing position before Election Day? Ditto for his position on abolishing the filibuster in the Senate.

>For Pence: The Electoral College seems to violate the maxim that each votes should count equally. Does the Trump administration favor reform? If not, why not?

>For Harris: Many Democrats argue that the Electoral College gives lightly populated, conservative and Republican-leaning states outsized political power. But why, then, was Barack Obama able to win the White House not once but twice?

>For Pence: Charges that America’s police are killing unarmed African Americans at the drop of a hat are clearly wild exaggerations. But don’t you agree that police stop African-American pedestrians and drivers much more often than whites without probable cause – a problem that has victimized even South Carolina Republican Senator Tim Scott?

For Harris: Will Biden insist that mayors and governors in cities and states like Oregon and Washington, which have been victimized by chronic antifa violence, investigate, arrest and prosecute its members and leaders immediately? And if they don’t, will he either withhold federal law enforcement aid, or launch such investigations at the federal level?

For Pence: Why should any public places in America honor Confederate figures – who were traitors to the United States? Can’t we easily avoid the “erasing history” danger by putting these monuments in museums with appropriate background material?

For Harris: Would a Biden administration support even peacefully removing from public places statues and monuments to historic figures like George Washington and Thomas Jefferson because their backgrounds included slave-holding?

For both: Shouldn’t voters know much more about the Durham Justice Department investigation of official surveillance of the Trump campaign in 2015 and 2016 before Election Day?

For both: Should the Big Tech companies be broken up on antitrust grounds?

For both: Should internet and social media platforms be permitted to censor any form of Constitutionally permitted speech?

For Pence: Doesn’t the current system of using property taxes to fund most primary and secondary public education guarantee that low-income school children will lack adequate resources?

For Harris: Aren’t such low-income students often held back educationally by non-economic factors like generations of broken families and counter-productive student behavior, as well as by inadequate school funding – as leading figures like Jesse Jackson (at least for one period) and former President Obama have claimed?

For Pence: What’s the difference between the kind of “patriotic education” the President says he supports and official propaganda?

For Harris: Would a Biden administration oppose local school districts using propagandistic material like The New York Times‘ U.S. history-focused 1619 Project for their curricula? Should federal aid to districts that keep using such materials be cut off or reduced?

Now it’s your turn, RealityChek readers! What questions would you add? And which of mine would you deep six?

Im-Politic: An Immigration and Racism Link Deserving Much More Attention

Tags

African Americans, Chicago, CNBC, H-1B visa, Hispanics, Im-Politic, Immigration, inequality, Jim Reynolds, minorities, Norman Matloff, race relations, racism, STEM workers, tech jobs, unemployment

“H-1B” and “racial injustice” probably aren’t terms most people would believe have much to do with each other. That’s why a recent CNBC interview with a leading African American financier deserves your attention even if it is two weeks old. Because he shows not only that they’re intimately connected, but that even someone who is focusing on the link needs to think much more about how exactly it works, and what needs to be done about it.

For those who don’t follow immigration issues closely, “H-1B” is the name of the category of visa that the federal government allots business for foreigners they supposedly need to employ because their “specialty” skills can’t be found in the domestic workforce. The skills cover a wide range, but according to this organization (which loves the program) most of the visas requested by U.S. companies are for science and technology occupations, and indeed their prevalence in these fields is responsible for most of the controversy they’ve generated.

For evidence abounds that, contrary to their claims, the tech companies that seek these foreign workers so ardently aren’t using them because they’re geniuses, but because they’re cheap – and because they need to remain tied to the company that sponsored them if they have any hope of getting permanent legal residence in the United States. (My go-to source on this issue is University of California-Davis computer scientist and immigration authority Norman Matloff, whose work can be found at this terrific blog.)

As a result, H-1B opponents argue that their use undercuts American pay levels in science and technology fields, and severely undercuts the argument that gaining these skills is one of the best guarantees available to young Americans of prospering in the turbulent economy of recent decades. But the program damages the economy in a way less often noted by opponents: It guts the incentives American business might develop to invest in American workers’ skills generally, or to press government to get the country’s education act together so as to make sure that the skills they need are available domestically.

And this is where the racial injustice and related economic inequality issues come into play – along with that CNBC interview. The subject, Jim Reynolds, is an inspiring African American success story who’s long been active in civic affairs in a city with one of the nation’s biggest African American populations – his native Chicago. (See this profile.) CNBC brought him on the air on July 2 to talk about racial diversity on Wall Street.

The conversation proceeded along these lines till it was about two thirds of the way through, when Reynolds made this totally unprompted and stunning pivot. Its worth quoting in full, and came in response to a question on whether he thinks Wall Street is genuinely committed to hiring more minorities in the wake of the George Floyd killing and ensuing tsunami of nationwide calls to end racism and related economic injustices.  (I also need to present it because this point didn’t make it into the CNBC news story accompanying the interview video that’s linked above.)   

“You ask if I think this is real…. I was at an Economics Club dinner a couple of years ago…and one of the top CEOs in the city [Chicago], actually, one of the top CEOS in the country – a Fortune 100 company – spoke to the group, and what he said to the group that one of his most frustrating experiences is working with H-1B programs, and why they won’t let his company recruit more of the talent that they need in the tech space….[H]e said that in the middle of downtown Chicago, where we have African American and Hispanic youth in the city, ten minutes from where he was standing, that have…let’s call it 40, 50, 60 percent unemployment, that go to schools that don’t really…teach them this sort of thing, and I wondered why he didn’t even think about this. Sure, you can go to China, and you can go to India, and recruit that talent. And that talent – and I’ve spent a lot of time in China – that talent started getting developed in middle school When they come here, and they go to the quants on Wall Street and the quants in Silicon Valley – and they do dominate that space – they started studying this stuff like when they were eight years old, nine years old. And I’ve started thinking about and talking about and I’m working with our wonderful Mayor Lori Lightfoot about, let’s get these corporations thinking about – and this time is great – investing in these black and Hispanic schools. Now. Let’s grab our young black and Hispanic kids in middle school. Let’s have a Facebook program in the school, Microsoft program, Alphabet program, Apple program in these schools. I think that’s an opportunity.”

I couldn’t have done a better job of making the H-1B-racial injustice connection. But as I suggested above, Reynold is still missing a piece of the puzzle: The CEO he mentions, and others like him, simply aren’t going to make those investments because they don’t have to. And they don’t have to precisely because they have a cheaper alternative – and one that doesn’t require them to deal with the kinds of workforce training challenges they’ve never faced: the H-1B program.

So if Reynolds really wants to expand opportunity for disadvantaged minority youth (and other young Americans) all over the country, he’ll start pressing for the elimination of the H-1B program, and for broader immigration policies that deny businesses in all sectors the easy option of hiring low-cost foreigners – and in the process, creating even more power over workers and thereby intensifying the downward pressure they can keep exerting on their wages and benefits.

Reynolds, moreover, is in a particularly good position to lobby for these changes effectively because, as made clear in the profile linked above, his close friends include a fellow named Barack Obama – who has more than a little influence on the liberals and progressives who have emerged (along with Corporate America) as among the stubbornest opponents of immigration policies that put American workers – including of course minority workers – first.

(What’s Left of) Our Economy: The Most Troubling Racial Economic Gap?

Tags

African Americans, Federal Reserve, George Floyd, inequality, personal finance, race relations, Survey of Consumer Finances, wealth, {What's Left of) Our Economy

As so widely and correctly reported in the wake of unarmed African American detainee George Floyd’s killing in Minneapolis last month by a white police officer, the economic gap between black and white Americans remains way too wide despite the progress made in recent decades. In addition, research consistently shows that this inequality can be found in every indicator you can think of. (Two recent summaries can be found here and here.) 

Some recent digging, however, has convinced me that nowhere is the problem bigger or more serious than in wealth – that is, what people earn (from wages, salaries, rents, or what have you) along with what they own (homes, autos, stocks, etc.) The above-linked Washington Post article makes clear why wealth matters so much, especially over time:

“More wealth makes for more a comfortable, safer living. And, more importantly, it is passed on to the next generation. Their parents’ wealth gives many white children a boost at birth, an advantage many of their black peers lack.”

But the closer you look at the wealth figures, the more surprising they are. For although the black-white gap has consistently remained formidable in absolute term going back to at least 1989, it has witnessed some fluctuations that haven’t been trivial, and that over time at least point in the right direction.

Here’s a table containing the black-white breakdown in wealth over recent decades. The source is a study released every three years by the Federal Reserve that’s called the Survey of Consumer Finances. Unfortunately, the latest edition only takes the story through 2016. (If schedules for the previous studies hold, the next release won’t come out until the early fall.) The numbers in the left-hand and center column represent the actual dollar wealth amounts, adjusted for inflation, of the typical white and black households. In other words, it shows us the median – the figure for households exactly at the midpoint of results for all households. The right-hand column shows that ratio between these levels. The source is this collection of charts that accompanied the latest release: 

                     non-hispanic white      non-hispanic black     ratio white:black

1989:                   132.7                                7.4                           17.93:1

1992:                   116.9                              16.9                             6.92:1

1995                    120.0                              17.1                             7.02:1

1998                    141.4                              22.9                             6.17:1

2001:                   166.3                              26.3                             6.32:1

2004:                   179.3                              26.0                             6.90:1

2007:                   198.3                              24.4                             8.13:1

2010:                   144.3                              17.6                             8.20:1

2013:                   146.4                              13.6                           10.76:1

2016:                   171.0                              17.1                           10.00:1

Over the longest term, it’s clear that the racial wealth gap has narrowed significantly. Indeed, from 1989 to 2016, it shrank by a little over 44 percent. Much more discouraging – the lion’ share of this progress took place during the three years between 1989 and 1992.  Since then, it’s widened by 44.50 percent.

The relationship between this wealth gap and the economy’s ups and downs are noteworthy, too. During the 1990s economic expansion (which took place essentially between the 1992 and 2001 figures), the gap narrowed modestly – from 6.92:1 to 6.32:1. But during the so-called bubble expansion of the first decade of this century (from 2001 through 2007), it widened significantly. And it widened further during the first six years of the last, pre-CCP Virus recovery – by nearly 22 percent.

At the same time, as that expansion took hold, the 2012-2016 results show that some narrowing resumed.

Also, odd –during the Great Recession, which lasted from the end of 2007 till the middle of 2009, the racial wealth gap barely widened at all.

Finally, though, according to a chart that ran in the above-linked Washington Post piece (and that I wasn’t able to reproduce), there’s data going back to the 1950s. I haven’t looked at the figures first hand, but if the graphic is accurate, the wealth gap narrowed dramatically through the late 1970s, (though the black household wealth levels start at a shockingly low level), suffered a terrible 1980s (even though the economy overall grew nicely during the decade), recovered sharply during the 1990s (an even stronger, longer expansion), and has regressed steadily this entire century (through 2016).  Worst of all, though, the caption’s message:  virtually no progress since the late 1960s – another time of racial and other national tumoil. 

Unfortunately, the next set of Fed figures won’t shed any light on the virus’ impact on this key measure of black economic performance and progress. But Americans may learn whether the country had finally started getting back on the right track.

 

 

Following Up: Why Many of America’s Widest Divides Aren’t What You Think

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college-educated, Democrats, education, Following Up, Gallup, healthcare, inequality, minorities, non-college, opportunity, partisanship, polling, polls, race relations, Republicans, whites

“An anxious and divided nation cast its first votes,” the headline in the Washington Post moaned this morning.

As yesterday’s RealityChek post reported, though, some impressive evidence came out last week showing that the nation isn’t all that anxious, or fatally divided in the most general terms, after all. At the same time, diving into that evidence’s internals shows no shortage of divisions – only many of the dividing lines are pretty surprising.  (See the PDF linked at the bottom where it says “View complete question responses and trends.”)

For not only is the most important division by far the partisan split between Democrats and Republicans. It’s a gap that tends to be considerably wider than those between groups where divides in the last few years are supposed to have been especially and worrisomely gaping – between blacks and whites, between rich and poor, between the better educated and the less well educated.

For me, the big takeaway is that when Americans are in political moods, they get carried away by their emotions, with Republicans feeling awfully chipper about the state of the nation, and Democrats correspondingly gloomy. When they’re not preoccupied with politics, Americans seem more level-headed – and their outlooks are sunnier. But the unexpected findings scarcely stop there!

For example, let’s look at the internals of the headline satisfaction finding, which shows Americans’ feelings about the quality of their lives. A lofty 84 percent of all Americans told Gallup that they’re satisfied on this score, and 37 percent said they were “very satisfied.”

Republicans were the most satisfied Americans by a wide margin – an astonishing 96 percent called themselves satisfied, and 60 percent considered themselves “very satisfied.” The least satisfied group? Democrats. Their satisfaction levels were 77 percent satisfied and only 25 percent very satisfied.

But here’s what really grabbed my attention – and should grab yours. Keep in mind that the various groups of respondents overlap considerably (for example, both Democrats and Republicans include the wealthy and the poor, and the college-educated and the high school grads; and the both the wealthy and the poor include those identifying with both political parties).

The Democrats’ satisfaction levels were lower than those for non-whites (79 percent) and for Americans with a high school education or less (84 percent). That doesn’t sound very consistent with the notion that non-whites and those with relatively modest education levels are feeling especially downtrodden lately. But these readings definitely point to special degrees of unhappiness among Democrats. So does the fact that the “very satisfied” results for both these groups (31 percent and 34 percent, respectively) topped those for Democrats as well.

The partisan divide is even bigger, in both absolute and relative terms, for satisfaction levels regarding whether working hard can get a person ahead in America these days. In toto, 72 percent of respondents were satisfied and 43 percent were very satisfied with this situation. Non-whites’ overall satisfaction and very satisfied levels weren’t too far off those figures (71 percent and 37 percent, respectively). And the figures for those holding a high school degree at most were notably higher (77 percent and 51 percent, respectively).

But the Democrats’ results were completely in the dumps (only 47 percent and 19 percent, respectively).

Also interesting – non-whites, and Americans lacking college degrees are all more convinced than the college grads (68 percent) about the payoff of working hard, with respondents with a high school degree or less expressing the highest (77 percent) satisfaction level.

Satisfaction levels are much lower in absolute terms (43 percent overall) over the distribution of income and wealth in America – which should surprise no one. But again, those lacking a high school degree were more satisfied, and by a wide margin (49 percent), while the least satisfied (also by a wide margin) were the Democrats (21 percent).

The least educated were also more satisfied with the current rich-poor gap than college graduates (40 percent). But on this issue, non-white satisfaction levels were lower than the average (38 percent).

Gallup respondents were even less satisfied with the availability of healthcare in the United States, with only 37 percent expressing such views. Yet a familiar pattern emerges from the internals. The biggest gap was between Republicans (53 percent satisfied) and Democrats (27 percent). These also represented the highest and lowest levels of all the groups examined.

In addition, non-whites (41 percent) were more satisfied than whites the overall total (37 percent), and much more satisfied not only than the Democrats but than college grads (31 percent). The same held for Americans without high school diplomas (also 41 percent satisfied).

Finally, let’s look at a particularly explosive issue – race relations. Or at least it’s supposed to be particularly explosive. But according to the Gallup survey, there’s much more dissatisfaction than polarization – except among Democrats and Republicans.

Overall satisfaction levels are low – coming in at 36 percent. But the widest gap by far is between followers of the two parties, with 51 percent of Republican identifiers declaring themselves to be satisfied compared with only 24 percent of their Democratic counterparts. (Actually, Gallup also measured satisfaction levels according to political ideology – liberals, moderates, and conservatives. I’ve left these findings out due to the assumption because these results closely track the political parties’ results – which include independent voters. But according to this gauge, the conservative-liberal gap is somewhat wider, at 52 percent-17 percent.)

Most significantly, this partisan divide is far wider than the racial divide, with 35 percent of whites expressing satisfaction with the state of race relations and 39 percent of nonwhites so stating. Also doubtless significant: The next-least-satisfied group is college graduates, of whom only 28 percent expressed satisfaction. Further, their “very satisfied” levels (3 percent) were by far the lowest along with the Democrats’. And they were only one-third the nine percent “very satisfied” levels of non-whites.

Is the country indeed anxious?  To some extent, sure.  Is it divided?  That’s where the answer gets especially complicated.  And this complex picture indicates that, especially in this presidential campaign year, all Americans should beware of pundits and others bearing sweeping generalizations. 

(What’s Left of) Our Economy: An Historically Uneven, as Well as Sluggish, Recovery

Tags

cities, inequality, Jobs, Labor Department, recovery, unemployment, {What's Left of) Our Economy

As the late, great comedian Rodney Dangerfield might have said, this current U.S. economic recovery “don’t get no respect,” and dissing it seems to grow ever more popular. Long derided as historically slow, and marked by marginal wage increases and lousy productivity, it’s now coming under fire for being shockingly uneven as well, confined to a handful of (admittedly huge) urban islands of prosperity like New York City and Washington, D.C., and the San Francisco Bay Area.

This morning came worse news – the gap between haves and have-nots is getting wider, at least when it comes to unemployment rates. This depressing conclusion – after nearly nine years of economic expansion – stems from the latest Labor Department data (for April) on joblessness and how it’s changed in 387 American urban areas.

But let’s start at the beginning (of the recovery). In June, 2009, unemployment rates rose year-on-year in all 372 of the metro areas then measured. So there was literally no place to go but up. But by February, 2010 – when the number of total American job-holders bottomed in absolute terms – unemployment rates were still increasing on an annual basis in 347 of these areas and falling in only 21.

This April, the situation was greatly improved. Unemployment rates dropped in 269 metropolitan areas and were up in only 94. (By now, the number of urban areas tracked has risen to 387.) But here’s the rub. The previous April, jobless rates were down in 344 areas and up in 36. In April, 2014, the numbers looked even better – down in 357, up in a mere 12. (In some areas, the rates haven’t changed.)

An optimist (or an Obama-phile) could argue that progress in cutting unemployment is slowing because the rate has already come down so dramatically during the recovery. And indeed it has – from the most recent peak of ten percent in October, 2009 to five percent in April. So clearly, there isn’t much more to go until any reasonable definition of full employment (which BTW, isn’t hard and fast).

At the same time, as RealityChek has reported so often, other measures of the employment scene, like wage and broader pay growth, still look pretty shaky. And heading into its eighth year, the recovery is looking pretty long in the tooth. The economy has so far displayed the ability to generate more impressive employment than growth results (hence, in a nutshell, the crummy productivity improvement), so it’s entirely possible that even when the recovery peters out, the number of jobs can keep increasing.  Therefore,however unsatisfactory the geography of prosperity these days, it may not get significantly worse for the time being.

But that’s likely a best case. If today’s growth shifts into reverse to any meaningful degree, America’s islands of prosperity could become even harder to find on a map.

Following Up: Why Mass Immigration Can’t Solve the U.S. Entitlements Crisis

Tags

2016 election, amnesty, Bernie Sanders, Branko Milanovic, Donald Trump, entitlements, Following Up, Global Inequality, Immigration, inequality, New York magazine

The (overwhelmingly one-sided) Donald Trump-Bernie Sanders-fueled debate on trade policy that’s broken out in the Establishment Media lately has been so heated that it’s eclipsed even immigration as a hot button presidential campaign issue. Not even Trump’s release of crucial details for his illegal immigration-stopping wall has managed to push trade out of the spotlight. It’s almost as if mainstream journalists and the elites they so often coddle have given up on pimping for Open Borders policies as America’s only non-racist, non-xenophobic immigration policy options.

All the same, who can reasonably doubt that pro-amnesty media propaganda will stage a comeback, especially if Trump shows signs of surmounting his current troubles and cruising again toward the Republican nomination? (Democrat Sanders nowadays is far from a maverick on immigration issues.) If immigration returns to the fore again, it will be worth remembering that one of the world’s leading economists has just punched big holes in one of the Open Borders’ backers’ main economic claims.

As noted in a September, 2014 RealityChek post, mass immigration supporters have taken to arguing that major inflows of newcomers are needed in large measure to help America deal with its looming entitlements crisis. The idea is that because the native-born U.S. population is aging so rapidly, and because so many immigrants are so young – and enterprising – their future earnings potential is the nation’s best bet for responsibly financing the immense wave of baby-boomer retirements that’s already begun.

As I also argued in that post, however, although immigrants who come to the country with high levels of skills and education are good candidates to play this essential role, the same cannot possibly hold for most illegal immigrants and many legal newcomers – who come with none of those attributes. For it’s becoming abundantly clear that America is becoming an economy and society with not only record levels of economic inequality, but an increasingly rigid class structure.

That is, the American Dream is far from completely dead, but Americans who are born poor are ever more likely to stay that way. And why should low-skill, poorly educated immigrants be an exception? Ironically, I added, the inequality crisis has become so apparent in large measure because of research from self-styled progressive analysts who favor more or less Open Borders. In addition, it was great to be able to point to a recent article in establishment organ Foreign Affairs that similarly debunked the portrayal of mass immigration as an economy saver.

Now, more reasons to doubt this pro-amnesty meme has just come in from Branko Milanovic, a former senior World Bank economist now with the City University of New York.

In his new book on Global Inequality, Milanovic has documented three major economic and social reasons for thinking that yawning rich poor gaps in the United States are here to stay, but that they will keep growing wider. As Milanovic explained in an interview in New York magazine: 

> “the share of total income going to capital compared to labor has been increasing” – and its wealthy Americans who dominate income generated by capital (i.e., the return on investments like property or stocks);

> in a new development, many wealthy Americans are now earning income both from their investments and from their labor – e.g., in very high-paying jobs in finance or technology companies; and

> these economic out-performers are increasingly marrying each other, and thus boosting the odds that both their wealth and their natural gifts will be inherited by their children. Interestingly, according to Milanovic, a major engine of this homogamy is the huge increase in the result of highly educated women.

Milanovic also cites a fourth reason to expect widening U.S. inequality – a political system increasingly of, by, and for the wealthy. In fairness, though, however formidable, this obstacle to a more equitable society seems less intractable than the three economic and social factors.

The author also cites reasons for supposing that America’s rich-poor gap might start narrowing once again. But their impact seems unlikely to predominate any time soon. And given the power of the inequality drivers Milanovic describes, nothing seems likelier to swamp the pro-equality forces if they ever do start gathering than a sizable new wave of impoverished, barely literate immigrants. Not to mention the pressure they themselves will place on the nation’s public purse.

Im-Politic: The Elite Media Just Became Even More Elitist

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American Prospect, Bill Clinton, boardroom liberalism, Establishment Media, Fred Hiatt, Harold Meyerson, Hillary Clinton, Im-Politic, Immigration, inequality, living standards, middle class, Noam Scheiber, Obama, offshoring, The Washington Post, Trade, unions, wages, working class

If you think (as you should) that the top priority of the Mainstream Media is to protect the nation’s bipartisan ruling class and its selfish, Main Street-shafting policies, you got strong support for your views last week, when Washington Post columnist Harold Meyerson announced he was being dropped from the paper’s roster of regular columnists.

The Post insists that ditching Meyerson had nothing to do with his liberal positions, but with what the TV business has long called “low ratings.” Here’s the official explanation, from Post editorial page editor Fred Hiatt, who wielded the axe:

“The Post opinion section takes pride in publishing a wide range of views, including progressives Eugene Robinson, EJ Dionne, Ruth Marcus, Greg Sargent, Paul Waldman and Katrina vanden Heuvel and contributing columnists Rachel Maddow and Danielle Allen. We’ve been pleased to publish Harold’s columns for the past 13 years, but he failed to attract readers as these others have. And while our decision should never be made based only on clicks, I think it would be arrogant to entirely ignore what our readers are telling us.”

But Meyerson himself – who has not protested the decision – nonetheless provided information making clear that his politics were indeed an issue. In an email to a reporter covering the move, Meyerson wrote:

“In my discussion with him, Fred cited two reasons for not renewing my column. In addition to the click-count, he said there was too frequent an emphasis in my column on ‘unions and Germany,’ by which he meant — my phrasing, not his — worker rights and an alternative form of corporate governance.”

This description, which Hiatt has not disputed, shows how misleading the Post‘s rationale is. It’s true that the paper publishes figures on the left end of the political spectrum. But none of them has consistently focused on the issues of economic power, its structure, and its effects, the way Meyerson has. Moreover, none of them has paid significant attention to the offshoring-friendly trade policies responsible for so much of destructive kind of wealth and income inequality characterizing America today – in which not only does the gap between the rich and the rest widen, but in which the living standards of working and middle class families actually worsens.

In fact, many of the writers listed in the Post statement are most accurately described as what New York Times reporter Noam Scheiber has insightfully called “boardroom liberals.” Here’s his definition:

“It’s a worldview that’s steeped in social progressivism, in the values of tolerance and diversity. It takes as a given that government has a role to play in building infrastructure, regulating business, training workers, smoothing out the boom-bust cycles of the economy, providing for the poor and disadvantaged. But it is a view from on high—one that presumes a dominant role for large institutions like corporations and a wisdom on the part of elites. It believes that the world works best when these elites use their power magnanimously, not when they’re forced to share it. The picture of the boardroom liberal is a corporate CEO handing a refrigerator-sized check to the head of a charity at a celebrity golf tournament. All the better if they’re surrounded by minority children and struggling moms.”

According to Scheiber, President Obama is a leading exemplar. Though the author seems to demur, I would argue that Hillary Clinton and her former chief executive husband are two others. And regular readers of the Post edit page and many of the aforementioned columnists will find this characterization familiar, too.

Not that Meyerson was the last word on what ails the nation economically. In particular, he toed the labor union line far too slavishly, including a refusal to recognize mass immigration as a mortal threat to U.S. wages, broader living standards, and economic security. His own particular dogmatism also included an uncritical worship of Big Government.

But Meyerson – who will still be appearing in his own American Prospect magazine, and apparently from time to time in the Post – did write from a perspective that’s all too rare inside the bipartisan Beltway political and media bubble. And Hiatt’s tortured rationalization all but guarantees that whatever replacement is chosen for Meyerson won’t make this capital gang any more diverse.

Im-Politic: New Survey Shows Surprising Areas of National Consensus

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abortion, American Values Survey, blacks, China, Democrats, Donald Trump, equal opportunity, family leave, Hispanics, illegal immigration, Im-Politic, Immigration, independents, inequality, Islam, minimum wage, multinational corporations, Muslims, offshoring, parental leave, police killings, polls, Public religious Research Institute, race relations, regulations, Republicans, same-sex marriage, Trade, whites

Just when you think you’re getting a handle on the American public’s mood in these raucous political and social times, along comes some polling data that rock your world. And I’m pleased to report that, in the case of the new American Values Survey published by the Public Religion Research Institute (PRII), the net results strike me as encouraging as they are surprising. Specifically, they indicate that the U.S. public is much less divided on many hot button social and cultural issues than politicians and the national media coverage have been indicating. In fact, the findings of this November survey suggest the gathering of a common sense consensus on these supposedly bitterly divisive matters.

The unexpected areas of agreement start with a subject close to the leading headline-maker of the day – Republican presidential front-runner Donald Trump’s call for a temporary ban on travel by all non-citizen Muslims into the United States. It’s too early for a poll on this specific proposal. But I found it instructive that, according to the PRII, Americans agree by a 56 percent to 41 percent margin that “the values of Islam are at odds with American values and way of life.” In 2011, only 47 percent agreed and 48 percent disagreed.

Moreover, although breaking the results down by political leanings produces differences, even 43 percent of Democrats share these suspicions of Islam. For Republican and independents, the figures are 76 percent and 57 percent, respectively.

The survey shows an even split on the question of whether immigrants “strengthen the country because of their hard work and talents” (47 percent agreed) or “constitute a burden on the U.S. because they take jobs, housing, and health care” (46 percent). But only last year, the “strengthen” option won out by 57 percent to 35 percent. The partisan gap is indeed wide, with 63 percent of Republicans holding such negative views of immigrants and 66 percent disagreeing. But 32 percent of Democrats were focused on immigrant-created economic burdens as well.

Even more suggestive of consensus on this issue, though, are the results for a slightly different question. Fully 45 percent of Democrats agreed that “illegal immigrants are at least somewhat responsible for America’s current economic woes” (as well as 70 percent of Republicans and 53 percent of independents). And check out the racial split: Majorities of white and black Americans (58 percent and 52 percent, respectively) told held illegal immigrants “at least somewhat responsible” for the nation’s economic troubles – along with 40 percent of Hispanic Americans. For good measure, so do 44 percent of the white and college-educated, who often benefit from low-wage illegal immigrant labor.

The PRII survey will scarcely comfort President Obama, Congress’ Republican leadership, or the multinational corporations who all support America’s current trade policies. Breakdowns were not provided, but 86 percent of Americans hold “corporations moving American jobs overseas…somewhat or very responsible for the present economic troubles facing the U.S.” That’s up from 74 percent in 2012. “China’s unfair trade practices” were cited by 73 percent. Not surprisingly, 72 percent of Americans believe the country is still in a recession, a figure that’s remained pretty steady 2012. Keep in mind that the current recovery began, at least technically, in mid-2009.

Large majorities also believed that “the current economic system is heavily tilted in favor of the wealthy” (79 percent); that lack of equal opportunity in America is a “big problem” (65 percent); and that “hard work is no guarantee of success” (64 percent – including 52 percent of Republicans).

And these majorities extended to numerous economic policies. Just over three-quarters of all Americans favor increasing the minimum wage to $10.10 per hour (including 60 percent of Republicans). Eighty five percent support paid sick leave and 82 percent back paid parental leave. And although no questions were asked about desired regulatory policy changes, 69 percent of respondents blamed “burdensome government regulations” for at least some of the nation’s economic predicament.

Signs of common ground were also evident on domestic social issues that are thought to be highly polarizing. For example, relatively few Democrats (36 percent) or Republicans (43 percent) considered abortion important to them “personally.” And the partisan split on same-sex marriage was smaller, and at lower levels of salience – 28 percent for Democrats and 29 percent for Republicans.

Big divides remained on numerous issues, to be sure – like confidence in the federal government, and a $15 minimum wage (lots of Republicans climb off that boat), and police treatment of minorities. Interestingly, in this vein, minority Americans are significantly more optimistic than whites that “America’s best days are ahead of us.”

But it’s hard to finish this latest American Values Survey feeling deeply pessimistic that the nation can’t overcome its differences and create that better future. In fact, one of my biggest reasons for hopefulness is the following finding: “Nearly two-thirds (66%) of the public agrees that, ‘everyday Americans understand what the government should do better than the so-called ‘experts.’ There is broad agreement across racial, generational, and partisan lines.”