Economy

Heat or Something to Eat? New SNAP Rules Might Force Poor Families to Choose

AP Images/Gerry Broome

The Senate is expected to vote on the Farm Bill today, which could reach President Obama’s desk later this week. A new version of the bill, which comes up for reauthorization every five years, has been delayed for two years; Congress has simply been renewing the most recent farm bill for short periods of time while the House and Senate fought over the details in the new one.

Why Alt-Labor Groups Are Making Employers Mighty Nervous

AP Images/John Minchillo

Union membership remained steady last year—steady at its near-hundred-year low. A mere 6.7 percent of private-sector workers are union members, as are 11.3 percent of U.S. workers overall, according to figures released last Friday by the Bureau of Labor Statistics (BLS.)

Obama Punts on Immigration

AP Photo

Those hoping for a full-throated, legacy-defining speech from President Barack Obama at his State of the Union address last night were sorely disappointed. In what amounts to a grudging acknowledgment that turning back the clock on not just four, but 40 years of stagnating wages and declining economic mobility will require the cooperation of Congress and broad government intervention, the president focused on small-bore economic initiatives that he could accomplish without cooperation from Congress—most markedly, an increase the minimum-wage limit for federal contractors to $10.10 an hour.

Obama Threads the Needle

For Democrats, for liberals, today’s political climate poses a singular challenge. On one hand, poll after poll shows the public believes the economy is rigged against all but the rich. On the other, poll after poll shows that the same public—particularly after the disastrous roll-out of Obamacare—doesn’t believe government is the answer to the failings of the market economy. Indeed, recent polls show that the public mistrusts big government more than it does big business (which does not mean it holds big business in high, or even middlin’, esteem).

The Six Constituencies the State of the Union Actually Mattered To

AP Images/Charles Dharapak

It was a strange State of the Union Address—mixing emotional tugs on the heartstrings with anodyne rhetoric that made it seem like everyone from Barack Obama to the angriest Tea Party Republican was bored with the annual exercise. The speech had no over-arching theme save (yawn) America’s enduring greatness. There were hard-hitting sentences and paragraphs, but no dramatic policy proposals nor even bold, if unattainable, dreams. The State of the Union address was unlikely to anger anyone whether it was financial titans fearing economic Kristallnach or Bashar al-Assad.

Investing in Stock Buybacks, Not People

AP Images/Richard Drew

One fundamental reason why the American economy continues to limp along is that no one—at least, no one with major bucks—is investing in it. The Obama Administration countered the collapse of private sector investment in 2009 with its stimulus program, which, alas, was partially offset by all the cutbacks in state and local government spending. It’s not been able, however, to get any subsequent investment projects through the Republican House. The private sector—the corporate sector more particularly—returned not just to profitability but record profitability by the middle of 2010, but its profits have neither resulted from nor led to increased investment.

Now It’s Time to Talk About Chicago’s Tale of Two Cities

AP Images/Charles Rex Arbogast

Rahm Emanuel has a favorite four-letter word for members of the labor movement. When Emanuel was White House chief of staff, he was told that tens of thousands of autoworkers could lose their jobs if General Motors and Chrysler didn’t receive a federal bailout. His response: “Fuck the UAW.” As mayor of Chicago, Emanuel became so enraged during negotiations with Karen Lewis, president of the Chicago Teachers’ Union, that he shouted “Fuck you, Lewis.” (The teachers went on strike for seven days, claiming Emanuel had “disrespected” them, as well as tried to force them to work longer hours after reneging on a promised pay raise.)

The Republican Problem With Independent Voters

Still a problem.

As I've discussed before, there are moral judgments liberals and conservatives make about things like economics that not only underlie the positions they take on policy, but also make most of the empirical conversation we have about those issues kind of superfluous. We spend a lot of time marshalling facts to support positions that have a moral basis, when those facts have virtually no chance of persuading large segments of the population. For example, you can tell many conservatives that income mobility in the United States is lower than that in many countries, and it won't dent their belief that in this land of opportunity, everyone gets what they deserve and your wealth is a clear indicator of your virtue.

The good folks at the Pew Research Center have a new poll that includes some interesting questions probing how people think about poverty and economic fairness, and it shows how on this increasingly salient question, Republicans have a real political problem. Let's take a look at their key table:

The State of Our Union? Economically Unjust

AP Images

To honor Martin Luther King, Jr., the White House declared a “day of service” in Dr. King’s memory, and President Obama spent a few minutes on Monday helping to serve meals in a soup kitchen near the White House. Talk about a tin ear, or a timid one.

When Public Opinions Collide

The progressive challenge of adjusting to a new climate of public opinion on deficits, entitlements, and jobs.

The Penultimate Watergate Baby

georgemiller.house.gov

The 1974 midterm elections, held in the wake of Watergate, were a Democratic landslide. The party increased its strength in the House of Representatives by more than 50 new members, many from suburban districts that had previously elected Republicans.

Class War: The View From the Board Room

The Vice-President for Governmental Affairs has just finished his report to the corporate board of directors.

“Thanks, Ted,” says the Chairman. “You and your Washington staff have done a great job. Getting that little amendment inserted in the budget bill will save us at least $25 million next year. …. Questions or comments? Paul?”

Paul, the hedge fund CEO: “I’m worried about the big picture down there in Washington, Ted. It’s a mess. Deficit out of control. The anti-business attitude. Not to mention incompetence. Can’t even run a website for their own health care program. Pathetic.”

Economic Outlook Remains Depressing

Every month at this time when the jobs report comes out, we get reminders not to put too much stock in any one month's numbers. This is wise counsel, first because there's some inherent volatility in month-to-month movements—for instance, December numbers may have been affected by bad weather—and second because these figures often get revised later as more data come in. So the pretty bleak numbers from December don't, in and of themselves, tell us much about how the recovery is going.

But those numbers are indeed pretty bleak. Only 74,000 new jobs were created in December, compared to a monthly average of 182,000 for the year. The unemployment rate fell to 6.7 percent, but that's because so many people dropped out of the labor force. The labor force participation rate is now 62.8 percent, its lowest rate since 1978. Some of that is a long-term decline due to an aging population, but most of it comes from people deciding there's no point in looking for work.

So let's look at the big picture.

Europe Limps on in the Year Ahead

The last meeting of the European Council in December 2013 was absent of much concern for economics. Instead the Council, a body made up of heads of EU states, who come together twice a year to discuss big picture policy issues, decided to focus on security and foreign policy instead. It was a sign that the region was no longer in an acute economic crisis and that other issues like the protests in Ukraine and the NSA’s spying program were of graver concern. In 2014 don’t expect the troubled waters of the eurocrisis to recede completely, but do look forward to a year full of small scares and pseudo-crises that might seem big but will amount to little.

The Flying News

AP Images/Daniel Reinhardt

It was a damned-if-you-do/damned-if-you-don’t contract that Boeing offered its workers last week, and its workers responded accordingly. Confronted with a contract that transformed their pensions into 401k’s, and with the company’s threat to relocate production of its new 777x to some other, lower-wage state unless its workers took the deal, the members of the International Association of Machinists Puget Sound/Boeing district approved the company’s offer by a suitably ambivalent 51-percent-to-49-percent margin.

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